In a paper published by Policy Network this week, Emeritus Professor John Salt and his colleagues Janet Dobson and Alan Latham of UCL analyse the latest data on migration trends in the UK and evidence on how past recessions have affected migration flows in Europe. While immigration has tended to fall and out-migration rise when unemployment increases, this pattern only lasts for a limited period. In the past three recessions that have affected Britain, inflows began to pick up quickly, often before a noticeable improvement in the country’s economic situation. Noting that the latest data on migration in the UK seem consistent with these trends, the authors warn “if this pattern is repeated in the present circumstances, total net immigration may decline less in the immediate future than some anticipate.”
How should these findings be interpreted? At first glance, they seem to justify the need for strong counter-cyclical immigration policies, where fewer migrants are admitted during an economic downturn and more migrants are sought during periods of expansion. The economic benefits of immigration may be evident when unemployment is low, allowing certain sectors to expand which would otherwise face labour shortages. During periods of high unemployment, migrants represent unwanted competition over a declining number of jobs. This is clearly the view shared by the British government, which has extended employment restrictions on Bulgarian and Romanian nationals and toughening the Resident Labour Market Test. The Spanish government has followed suit by introducing a ‘voluntary repatriation scheme’, whereby unemployed migrants are paid to return to their source country.
However, upon closer examination, it becomes clear that the understandable impulse to restrict immigration during a recession is at best ineffective and, at worst, damaging for the prospects of economic recovery. First of all, government levers for controlling the flow of migrants are limited and we should be wary about raising public expectations about the effects these policies will have. In the UK, EU citizens – including A8 migrants, which constituted the majority of migrants entering the UK last year – fall outside the scope of the new points-based system. For non-EU migrants, the notion that policy can respond quickly to changing economic circumstances is also doubtful, even with the expert services of the new Migration Advisory Committee in hand.
Moreover, in their efforts to address the short-term challenges of the economic crisis, governments neglect the medium- and long-term benefits of immigration at their own peril. As a new OECD report highlighted last month, Europe will continue to need migrant labour notwithstanding the recession in order to resolve the long-term problems of an ageing population and declining workforce. Ultimately, as John Salt and his colleagues highlight in their paper, migrant workers are not only here to stay, they have also become an indispensable part of the UK economy. Accepting this reality and ensuring that migrant workers are incorporated into the government’s economic recovery strategy will form an essential part of its success.
The paper by Salt, Dobson and Latham can be downloaded from the Policy
Network website and forms part
of Policy Network’s new research project on ‘Managing migration in
times of economic turbulence’, supported by the Barrow Cadbury Trust