Migrants in the workforce: facts v fiction

Government policy does mercifully little to affect the labour market, even if it could be doing better.

NIESR's Jonathan Portes takes the time to critique Home Office minister Mark Harper. Harper said, in a comment on last week's labour force data release:

These figures show we are building a better immigration system that works in the national interest and is supporting growth. The rise in numbers in employment has benefited British citizens first, but our system is still allowing skilled migrants to come to the UK where they are needed by British businesses.

Portes argues that the labour force survey shows no such thing. When we look at the proportions of the working age population and of people in employment who are foreign born, we find a stark correlation, and a smooth trend. The trend is slightly accelerated by the new EU member states in 2004, and temporarily stalled by the recession, but largely consistent:


As Portes writes:

It is difficult - or at least certainly far too early - to see any significant change in the long run trend here. It is therefore difficult to see how changes to the immigration system could have had any substantial impact, as yet, on the employment of the UK born.

Thankfully, if the solution is imaginary, so too is the problem. Harper is continuing a Tory meme that "new jobs go to migrants".

Here's Fraser Nelson's take on the meme, for instance:

Over the 12-month period to which Osborne refers [Q2 2010 to Q2 2011], 90.1 per cent of the extra employment amongst the working-age population can be accounted for by an increase in foreign nationals working in the UK.

As Portes points out, thought through for a couple of seconds, such a claim is clearly nonsense:

Think about where you work. How many of the last ten people who were hired were immigrants? In most workplaces, probably none, one, or two. Very roughly, about 20,000 people start a new job every working day in the UK — the vast majority were born here.

The claim is actually just a restatement of arithmetic fact. The proportion of the population which is foreign born is increasing almost as quickly as the workforce. Rephrasing that as "foreign nationals taking most jobs" is as untrue as it would be to say that between 2009 and 2011 219 per cent of new jobs were taken by disabled people.

The government's policy has little effect on the stats cited above because the government's policy has little effect on immigration. It can only fiddle at the margins, thanks to the combined pressures of EU migration and British emigration. That's not to say it can't still do a huge amount of damage, as Cameron learned to his cost when he had to go pleading to India to promise better treatment at the hands of UKBA; and if we're talking about pro-growth migration policies, there's only one, and it's more migration.

But we'll still see the same old hackneyed arguments come up tomorrow, when the immigration statistics come out. So consider this a pre-buttal. Whether or not the government has achieved its populist target of slashing net migration, it's doing mercifully little to affect the labour market, even if it could be doing better.

"So, which line is the one for the job-stealing scum and which is for patriotic Brits spreading wealth abroad?" Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Why relations between Theresa May and Philip Hammond became tense so quickly

The political imperative of controlling immigration is clashing with the economic imperative of maintaining growth. 

There is no relationship in government more important than that between the prime minister and the chancellor. When Theresa May entered No.10, she chose Philip Hammond, a dependable technocrat and long-standing ally who she had known since Oxford University. 

But relations between the pair have proved far tenser than anticipated. On Wednesday, Hammond suggested that students could be excluded from the net migration target. "We are having conversations within government about the most appropriate way to record and address net migration," he told the Treasury select committee. The Chancellor, in common with many others, has long regarded the inclusion of students as an obstacle to growth. 

The following day Hammond was publicly rebuked by No.10. "Our position on who is included in the figures has not changed, and we are categorically not reviewing whether or not students are included," a spokesman said (as I reported in advance, May believes that the public would see this move as "a fix"). 

This is not the only clash in May's first 100 days. Hammond was aggrieved by the Prime Minister's criticisms of loose monetary policy (which forced No.10 to state that it "respects the independence of the Bank of England") and is resisting tougher controls on foreign takeovers. The Chancellor has also struck a more sceptical tone on the UK's economic prospects. "It is clear to me that the British people did not vote on June 23 to become poorer," he declared in his conference speech, a signal that national prosperity must come before control of immigration. 

May and Hammond's relationship was never going to match the remarkable bond between David Cameron and George Osborne. But should relations worsen it risks becoming closer to that beween Gordon Brown and Alistair Darling. Like Hammond, Darling entered the Treasury as a calm technocrat and an ally of the PM. But the extraordinary circumstances of the financial crisis transformed him into a far more assertive figure.

In times of turmoil, there is an inevitable clash between political and economic priorities. As prime minister, Brown resisted talk of cuts for fear of the electoral consequences. But as chancellor, Darling was more concerned with the bottom line (backing a rise in VAT). By analogy, May is focused on the political imperative of controlling immigration, while Hammond is focused on the economic imperative of maintaining growth. If their relationship is to endure far tougher times they will soon need to find a middle way. 

George Eaton is political editor of the New Statesman.