Swathes of the UK economy including health, warehousing and packing are being propped up by migrant workers – casting doubt on the prudence of the Conservative Party’s promise to tighten immigration policy.
(Bloomberg) — Swathes of the UK economy including health, warehousing and packing are being propped up by migrant workers – casting doubt on the prudence of the Conservative Party’s promise to tighten immigration policy.
Almost half of specialist medical practitioners, two-in-five generalist doctors and more than a quarter of mental health nurses were born outside the UK, according to census data collected in 2021 and released by the Office for National Statistics on Tuesday. The industry with the largest proportion of non-UK workers was packers, bottlers, canners and fillers, at 60.7%.
The figures give a sense of the challenge facing Prime Minister Rishi Sunak’s government as it tries to make good on commitments to voters to slash immigration while also keeping the economy supplied with workers. Britain alone in the Group of Seven has yet to recover its pre-pandemic level of output, and a shortage of people to take jobs is part of the problem.
On census day in March 2021, there were 48.6 million residents in England and Wales aged 16 and over. Of those, 80.9% were born in the UK and 19.1% were born abroad. That’s up from 13% the last census in 2011, before Britain voted to leave the European Union.
Staff shortages are most acute in the the National Heath Service, which is struggling with a soaring case load while workers drift away for better paying jobs. Wages in the public services have fallen behind the private sector, triggering strikes across the NHS along with railways, ambulance drivers and teachers.
There’s increasing calls for ministers to rethink immigration, which “tends to be employment-rich – good for the public finances,” Paul Johnson, director of Institute for Fiscal Studies, said at a hearing in Parliament.
Promises to tighten the UK’s border played a crucial role in the 2016 Brexit vote. Since then, net migration of EU workers has begun to fall – though this has been balanced out by higher migration from other countries.
It’s one of the things leaving the UK economy headed for stagnation. The Bank of England estimates the economy can grow just 0.7% without spurring inflation.
The highest employment rate was among working-age residents from the EU, at 78.2%. The UK’s rate was 71.2% while 64.9% of non-EU people were in work.
So-called elementary occupations, such as agricultural, cleaning, food preparation and refuse collectors, were the most reliant on a non-UK-born workforce, with 31.2% of their staff coming from abroad.
Hospitality and retail businesses in particular were complaining of a lack of staff following the pandemic, as EU workers left the UK.
But it isn’t just jobs typically perceived as being lower-skilled which depend on foreign-born employees.
Of the UK’s specialist medical practitioners, such as oncologists and cardiologists, 47.5% are from abroad. The largest group, at 26.3%, were born in the Middle East and Asia, followed by Africa at 8.5%.
One in four care workers and home carers were from outside the UK, and 18% of people in sales and customer services occupations were born abroad.
In the aftermath of Brexit, the UK adopted a new points-based immigration system. This was set out in the Conservative Party’s 2019 manifesto, which promised to “take back control of our borders” and be “firmer and fairer” on migrants.
Unless they are eligible to immigrate under strictly defined other programs, anyone now wanting to work in the UK must have been offered a job by a government-approved employer, and must gain 70 points on a checklist which weighs up criteria such as salary, educational attainment and whether the role is on a shortage occupation list.
This was designed to boost employment among UK nationals, and encourage more wealth to remain in the country. But economists have warned of the dangers of imposing restrictions on a country whose own labor market is not yet skilled or motivated enough to fill vacant roles.
Bloomberg Economics estimated that Brexit is costing the UK £100 billion a year, part of which is due to fewer workers coming to the UK than might have been the case.
The IFS’s Johnson, and even the Bank of England, have also said that Brexit is holding back the UK’s economic recovery.
Just last week, Chancellor Jeremy Hunt was forced to add construction to the shortage list following complaints from building firms that they couldn’t hire fast enough, which was pushing up costs as they tried to lure in workers with higher salaries.
Companies across the services and manufacturing industries have also complained of similar problems, which has been adding to the UK’s red-hot inflation rate. In the year to June 2022, the ONS estimated that 1.1 million people long-term immigrated to the UK.
On a net basis, this added 504,000 people to the UK population. But a net total of 51,000 EY nationals left.
Tomasz Wieladek, chief European economist at investment manager T. Rowe Price Group Inc, said the exodus of Europeans at the top end of the labor market was partly down to “the imperfect diplomatic efforts to resolve Brexit issues between the UK and the EU.”
But following the agreement of the Windsor Framework, “if we now go into a period where we can have more normal diplomatic relations between the UK and the EU – which are mutually beneficial – that’s the sort of thing that might change people’s attitudes about coming here,” Wieladek said.
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