The right tries to blame youth unemployment on immigration -- again

MigrationWatch has been allowed to get away with irresponsible scaremongering for too long.

Eighteen months ago, MigrationWatch published a report which attempted to show a relationship between immigration and youth unemployment in different parts of the UK. The methodology was comprehensively demolished here by my IPPR colleague Sarah Mulley -- but not before the report had generated the desired round of headlines such as "Migrants rob young Britons of jobs".

Today, as the nation worries about a "lost generation" with over a million young people unemployed, and an increasing proportion out of work for more than a year, MigrationWatch are at it again, with another report: Youth unemployment and immigration: more than a coincidence.

The report takes two dates -- 2004, when Eastern Europeans started coming to the UK in large numbers after the expansion of the European Union, and 2011. It notes that over this period in the UK, the number of Eastern European workers rose by around 600,000, while the number of unemployed young people rose by around 450,000. The head of MigrationWatch, Andrew Green, then comments that:

Correlation is not causation but when the two statistics are placed side by side most objective people would consider it a very remarkable coincidence if there was no link at all between them.

And while the report rambles on for another six pages, that's really about it. MigrationWatch have clearly learned the lesson of their last attempt: the more detail there is in their report, the easier it is for people who actually understand statistics or economics to show them up. Why bother, if simply asserting that the two numbers are suspiciously similar is enough to have the desired effect?

To anyone who is actually interested in how immigration affects our labour market, there is a good deal of high quality research on the subject: a useful review of the literature can be found here. In summary, while some studies have found some impact on wages, particularly towards the bottom of the wage distribution, hardly any studies have found any significant impact on overall unemployment. (Coincidentally, the National Institute for Economic and Social Research is publishing another report today, in the first major study to look at National Insurance Number data to examine the same issue.)

I don't wish to duplicate this body of research, nor get too deep into the detail of economic modelling; so I will confine myself to highlighting three points, which demonstrate the total inadequacy of MigrationWatch's report.

First, the choice of dates. MigrationWatch's chosen start-date is 2004. That is understandable, in the sense that it is when large scale Eastern European migration to the UK began. But it hides the fact that youth unemployment clearly started rising before that, around 2002 (see here). If immigration caused unemployment, you would expect to see immigration starting to rise first, followed by youth unemployment. In fact, it is the other way round. (Some readers might be tempted to reply that other kinds of immigration were rising before 2004. But while this is true, it can't help MigrationWatch, because those other kinds of immigration started rising in the late 1990s, after which point youth unemployment continued to fall for five years.)

Second, the fact that MigrationWatch focus on the change in the two variables across the whole period. This makes the numbers look at least vaguely similar. But what happens if you look in slightly more detail within the chosen period? If MigrationWatch's hypothesis was right, you would expect to see the steepest increase(s) in youth unemployment at the same time as, or shortly after, the big increase(s) in immigration. But here too, the picture is the opposite: the big increase in youth unemployment came in 2008 and 2009, during the recession caused by the financial crisis (that being a clue to what might really be going on), which was precisely the time when net immigration from Eastern Europe fell close to zero (see fig 2.2 here. To be fair to MigrationWatch, this is plainly visible in the graph on p.2 of their report, though it isn't mentioned in the report or in the press notice sent to the media.)

Third, the lack of any attempt to test the correlation across different parts of the UK, or across different countries. Of course, as I have already pointed out, when in a previous report MigrationWatch did try to show that the correlation held across different parts of the UK, it was an embarrassing failure. What about other countries? It looks unlikely that there is any correlation here: the countries in the 'old' EU which have seen the steepest rises in youth unemployment since 2004, including Spain and Greece, have not had very high levels of migration from Eastern Europe; while Germany, which has had relatively high migration from Poland (despite maintaining transitional controls for the longest possible period), has relatively low youth unemployment.

Given the contents of the report, its title -- More than a coincidence? -- is almost funny. But in the end, yet another media intervention, designed to generate a round of headlines (in the Express, Telegraph, and Sun, and on the BBC) blaming historically high youth unemployment on foreigners, isn't funny at all. It is irresponsible and pernicious, as well as a distraction from the serious debate over practical measures to alleviate youth unemployment -- including IPPR's proposal of a job guarantee for those out of work for more than a year.

Britain clearly has a youth unemployment problem: one which started before the financial crisis, but has since risen to critical levels. But its causes are too complex to be reduced to blaming immigration, just as the effects of immigration on the labour market are too complex to be reduce to the endlessly repeated headlines about "foreigners taking all the new jobs". New migrants compete for jobs with existing residents, but they also fill gaps, make our labour market more flexible, and bring energy and creativity, all of which promote growth -- meaning more jobs to go around. The net effect of all of this on the overall economy is hard to assess, but most economists agree it is positive. The net effect on different groups within the economy is even harder to assess. Again, for most, it will be positive -- though not for all. But this needs careful research, and honest presentation, not the kind of scaremongering which the media has let MigrationWatch get away with for too long.

Matt Cavanagh is an Associate Director at IPPR. Follow him on Twitter @matt_cav_

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How Theresa May laid a trap for herself on the immigration target

When Home Secretary, she insisted on keeping foreign students in the figures – causing a headache for herself today.

When Home Secretary, Theresa May insisted that foreign students should continue to be counted in the overall immigration figures. Some cabinet colleagues, including then Business Secretary Vince Cable and Chancellor George Osborne wanted to reverse this. It was economically illiterate. Current ministers, like the Foreign Secretary Boris Johnson, Chancellor Philip Hammond and Home Secretary Amber Rudd, also want foreign students exempted from the total.

David Cameron’s government aimed to cut immigration figures – including overseas students in that aim meant trying to limit one of the UK’s crucial financial resources. They are worth £25bn to the UK economy, and their fees make up 14 per cent of total university income. And the impact is not just financial – welcoming foreign students is diplomatically and culturally key to Britain’s reputation and its relationship with the rest of the world too. Even more important now Brexit is on its way.

But they stayed in the figures – a situation that, along with counterproductive visa restrictions also introduced by May’s old department, put a lot of foreign students off studying here. For example, there has been a 44 per cent decrease in the number of Indian students coming to Britain to study in the last five years.

Now May’s stubbornness on the migration figures appears to have caught up with her. The Times has revealed that the Prime Minister is ready to “soften her longstanding opposition to taking foreign students out of immigration totals”. It reports that she will offer to change the way the numbers are calculated.

Why the u-turn? No 10 says the concession is to ensure the Higher and Research Bill, key university legislation, can pass due to a Lords amendment urging the government not to count students as “long-term migrants” for “public policy purposes”.

But it will also be a factor in May’s manifesto pledge (and continuation of Cameron’s promise) to cut immigration to the “tens of thousands”. Until today, ministers had been unclear about whether this would be in the manifesto.

Now her u-turn on student figures is being seized upon by opposition parties as “massaging” the migration figures to meet her target. An accusation for which May only has herself, and her steadfast politicising of immigration, to blame.

Anoosh Chakelian is senior writer at the New Statesman.

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