Why MigrationWatch is wrong — a plea for a more robust debate on immigration

If MigrationWatch wants to be taken seriously, it needs to go back to the statistics textbooks.

Last week, a series of media headlines suggested that immigrants were taking jobs away from British people as the economy enters recovery. These stories were based in part on new ONS statistics, bolstered in some of the papers by reference to a report from MigrationWatch which purported to show that recent immigration to the UK has caused higher unemployment.

I wrote here about why these stories were misleading, and explained that the MigrationWatch report had failed to demonstrate the causal link claimed by the headline on its press release ("Immigration has damaged employment prospects for British workers", MigrationWatch press release, 12 August).

Perhaps it's to be expected that MigrationWatch might play a bit fast and loose with the evidence -- it is a campaign group, after all. But this seems to be becoming a habit: yesterday it published another report, using an even more flawed methodology, to make very strong claims about immigration and youth unemployment. This was duly picked up by the right-wing media -- the Express today repeats this study's claims under the headline "Migrants rob young Britons of jobs", and the Telegraph goes for "13 per cent rise in Neets 'linked to immigration' ".

So here, for the record, are three important methodological reasons why MigrationWatch's claims don't stand up.

1. It is looking at the wrong variables (part 1)

Yesterday's MigrationWatch report on immigration and youth employment made the basic error of comparing the absolute numbers of migrants and young unemployed people between local authorities, rather than migration or youth unemployment as a percentage of local populations. This makes its findings more or less worthless.

It means that, in all likelihood, all it has demonstrated is that different local authorities have different populations (for example, in the 50 local authority areas the report analyses, Manchester has a population of roughly 500,000, while Cambridge has about 120,000 only), and that local authority areas with higher populations have both more migrants and more young unemployed people.

This probably also explains why MigrationWatch finds a much weaker relationship between migration and youth unemployment in London: London boroughs have more evenly-sized populations than the areas that the organisation's analysis focuses on.

2. It is looking at the wrong variables (part 2)

Last week's MigrationWatch report did look at migration and unemployment rates as percentages of local populations, rather than absolute numbers. But it plotted net migration between 2003 and 2009 against levels of unemployment in 2008/2009 -- any basic descriptive analysis should have looked at the change in unemployment in the period in question.

MigrationWatch would like us to think that immigration has caused unemployment to rise, but perhaps migrants have moved into areas that have always had high levels of unemployment, and immigration has had absolutely no impact at all on this. In fact, perhaps the migrants have been part of an economic renaissance in those areas and unemployment has fallen. The MigrationWatch report can tell us nothing about any of this, because it looks only at unemployment levels in 2008/2009, not changes in unemployment.

In fact, plot MigrationWatch's own 2003-2009 immigration measure in "high immigration" areas against changes in unemployment between 2003/2004 and 2008/2009, and you see that the relationship it claims to find between migration and unemployment disappears. In fact, we might even suggest that it is reversed -- the chart below (analogous to Figure 3 in last week's MigrationWatch report) could be taken to show that higher immigration is associated with lower increases in unemployment (coefficient = -0.2).

Migration

If I was working with the MigrationWatch model, I would now issue a press release saying: "Immigration reduces unemployment: for every 1,000 immigrants moving into these areas, unemployment was reduced by 200, on average. The government should therefore increase immigration in order to tackle worklessness."

I'm not doing this, because the chart above shows no such thing. If we excluded a couple of outliers it would show no relationship at all; and at best it shows correlation, not causation. This is MigrationWatch's third major methodological mistake.

3. The reports show (if anything) correlation, not causation

Both MigrationWatch reports show, at best, correlation, not causation. But the organisation makes strong causal claims on the basis of their analysis -- that immigration causes unemployment, and that reducing immigration would help to reduce unemployment. Last week Andrew Green used one of the reports to claim that

. . . this demonstrates that the "open-door" policies of the past decade have had a damaging effect on the employment, and therefore the standard of living, of UK-born workers in the areas most affected.

And yesterday, he said that: "Many factors contribute to youth unemployment but this research suggests that immigration is a significant factor in areas of high immigration. The case for getting immigration down to sensible levels, as the government has promised, gets stronger by the day."

Oddly, MigrationWatch now seems aware of this limitation of its methodology (perhaps someone attached to the organisation has read my paper, or Monday's column in the Guardian from Gary Younge), and indeed it admitted as much in yesterday's report (and associated press release) when it said:

These findings are based upon correlation analysis which does not, by itself, provide evidence of any causal relationship . . .

But it can't stop itself making unfounded claims. The report continues directly:

. . . but the findings nonetheless are highly indicative of the relationships between youth unemployment and migration.

Overall, the key findings are that:

  • The relationship between immigration and youth unemployment is positive and significant in the 50 local authorities in England with the highest rates of migration in the period 2003-2009, and in London.
  • The relationship becomes stronger and more adverse the higher the rate of immigration. In a sample of those local authorities outside London with the highest rate of immigration, the relationship is very strong (correlation of 0.9), and shows that, on average, for every 1,000 immigrants into these areas, the number of young unemployed rises by around 900.

The relationship MigrationWatch showed in yesterday's report may be positive (though, as noted above, it is looking at the wrong variables, which makes the results more or less irrelevant), but it isn't significant (in the statistical sense), and the group certainly hasn't demonstrated that an additional 1,000 immigrants arriving in any area caused 900 more young people to be unemployed.

I set out some more detail on this point, and some alternative interpretations of the findings from last week, in a paper published this week. To demonstrate that immigration has caused unemployment, MigrationWatch would have needed to conduct some econometric modelling, controlling for a range of other factors and establishing statistically significant results.

In fact, a number of studies have already done this. They are summed up in a paper by my colleagues Maria Latorre and Howard Reed:

In short, the best available UK microeconomic evidence on the effects of migration on employment finds either no effect at all, or very small negative effects.

This conclusion is also supported by a wide range of research in other OECD countries.

None of this is to say that immigration has never had an impact on employment -- indeed, it seems likely that it has had impacts in some areas of the UK, and perhaps for young people in particular. In general, however, the claim that migration causes increased unemployment is not supported by the evidence, and is definitely not proved by either of the MigrationWatch reports.

Poor-quality evidence harms the debate

If MigrationWatch wants to engage seriously on the question of migration and employment, it needs to go back to its statistics textbooks. I don't agree with it, but I'd like to engage in debate about its arguments, rather than its research methodologies.

This is, in effect, a plea for MigrationWatch to up its game -- if it finds any real evidence that migration has harmed employment in the UK, we all need to know about it. It is also worth remembering that this isn't just some intellectual or rhetorical exercise; important questions of government policy (and the lives of real people) are affected by the public mood that MigrationWatch helps to generate.

But this article is written much more in sorrow than in anger. Nick Clegg said this week that it is important to make sure that the immigration system "has people's confidence and trust and they know it works". The first step towards this objective is to have an open and robust public debate about immigration; but that debate can happen only on the basis of a shared understanding of certain basic facts, and of what constitutes valid evidence.

Sadly, MigrationWatch's contributions in the past week confuse, rather than enlighten.

Sarah Mulley is a senior research fellow at the Institute for Public Policy Research (IPPR).

Sarah Mulley is associate director at IPPR.

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MPs Seema Malhotra and Stephen Kinnock lay out a 6-point plan for Brexit:

Time for Theresa May to lay out her priorities and explain exactly what “Brexit means Brexit” really means.

Angela Merkel has called on Theresa May to “take her time” and “take a moment to identify Britain’s interests” before invoking Article 50. We know that is code for the “clock is ticking” and also that we hardly have any idea what the Prime Minister means by “Brexit means Brexit.”

We have no time to lose to seek to safeguard what is best in from our membership of the European Union. We also need to face some uncomfortable truths.

Yes, as remain campaigners we were incredibly disappointed by the result. However we also recognise the need to move forward with the strongest possible team to negotiate the best deal for Britain and maintain positive relationships with our nearest neighbours and allies. 
 
The first step will be to define what is meant by 'the best possible deal'. This needs to be a settlement that balances the economic imperative of access to the single market and access to skills with the political imperative to respond to the level of public opinion to reduce immigration from the EU. A significant proportion of people who voted Leave on 23 June did so due to concerns about immigration. We must now acknowledge the need to review and reform. 

We know that the single market is founded upon the so-called "four freedoms", namely the free movement of goods, capital, services and people & labour. As things stand, membership of the single market is on an all-or-nothing basis. 

We believe a focus for negotiations should be reforms to how the how the single market works. This should address how the movement of people and labour across the EU can exist alongside options for greater controls on immigration for EU states. 

We believe that there is an appetite for such reforms amongst a number of EU governments, and that it is essential for keeping public confidence in how well the EU is working.

So what should Britain’s priorities be? There are six vital principles that the three Cabinet Brexit Ministers should support now:

1. The UK should remain in the single market, to the greatest possible extent.

This is essential for our future prosperity as a country. A large proportion of the £17 billion of foreign direct investment that comes into the UK every year is linked to our tariff-free access to a market of 500 million consumers. 

Rather than seeking to strike a "package deal" across all four freedoms, we should instead sequence our approach, starting with an EU-wide review of the freedom of movement of people and labour. This review should explore whether the current system provides the right balance between consistency and flexibility for member states. Indeed, for the UK this should also address the issue of better registration of EU nationals in line with other nations and enforcement of existing rules. 

If we can secure a new EU-wide system for the movement of people and labour, we should then seek to retain full access to the free movement of goods, capital and services. This is not just in our interests, but in the interests of the EU. For other nation states to play hardball with Britain after we have grappled first with the complexity of the immigration debate would be to ignore rather than act early to address an issue that could eventually lead to the end of the EU as we know it.

2. In order to retain access to the single market we believe that it will be necessary to make a contribution to the EU budget.

Norway, not an EU member but with a high degree of access to the single market, makes approximately the same per capita contribution to the EU budget as the UK currently does. We must be realistic in our approach to this issue, and we insist that those who campaigned for Leave must now level with the British people. They must accept that if the British government wishes to retain access to the single market then it must make a contribution to the EU budget.

3. The UK should establish an immigration policy which is seen as fair, demonstrates that we remain a country that is open for business, and at the same time preventing unscrupulous firms from undercutting British workers by importing cheap foreign labour.  

We also need urgent confirmation that EU nationals who were settled here before the referendum as a minimum are guaranteed the right to remain, and that the same reassurance is urgently sought for Britons living in mainland Europe. The status of foreign students from the EU at our universities must be also be clarified and a strong message sent that they are welcomed and valued. 

4. The UK should protect its financial services industry, including passporting rights, vital to our national prosperity, while ensuring that the high standards of transparency and accountability agreed at an EU level are adhered to, alongside tough new rules against tax evasion and avoidance. In addition, our relationship with the European Investment Bank should continue. Industry should have the confidence that it is business as usual.

5. The UK should continue to shadow the EU’s employment legislation. People were promised that workers’ rights would be protected in a post-Brexit Britain. We need to make sure that we do not have weaker employment legislation than the rest of Europe.

6. The UK should continue to shadow the EU’s environmental legislation.

As with workers’ rights, we were promised that this too would be protected post-Brexit.  We must make sure we do not have weaker legislation on protecting the environment and combatting climate change. We must not become the weak link in Europe.

Finally, it is vital that the voice of Parliament and is heard, loud and clear. In a letter to the Prime Minister we called for new joint structures – a Special Parliamentary Committee - involving both Houses to be set up by October alongside the establishment of the new Brexit unit. There must be a clear role for opposition parties. It will be equally important to ensure that both Remain and Leave voices are represented and with clearly agreed advisory and scrutiny roles for parliament. Representation should be in the public domain, as with Select Committees.

However, it is also clear there will be a need for confidentiality, particularly when sensitive negotiating positions are being examined by the committee. 

We call for the establishment of a special vehicle – a Conference or National Convention to facilitate broader engagement of Parliament with MEPs, business organisations, the TUC, universities, elected Mayors, local government and devolved administrations. 

The UK’s exit from the EU has dominated the political and economic landscape since 23 June, and it will continue to do so for many years to come. It is essential that we enter into these negotiations with a clear plan. There can be no cutting of corners, and no half-baked proposals masquerading as "good old British pragmatism". 

The stakes are far too high for that.