Employers: It’s your job to get migration down to 100,000

The Conservative manifesto has reiterated the party’s promise to cut net migration to below 100,000. That implies a reduction of over 60 percent and, although the manifesto doesn’t give a timeframe, even achieving the target by the next general election would be a colossal task.

So how will it be implemented? Who is going to deliver this massive reduction in immigration? Employers, of course.

There was much talk during the Brexit referendum about taking control of our borders and  Theresa May repeated the phrase at the manifesto launch. It is very unlikely, though, that the UK will introduce restrictions on the entry of EU citizens at the borders. Any constraints the UK places on travel from the EU are likely to be reciprocated. Therefore, if we require visas from EU citizens, then we will need visas to visit European countries. If we start interrogating Romanians and Bulgarians when they arrive at Gatwick about the purpose of their visit to the UK, we can expect the same treatment when we go on business to Frankfurt or on holiday to Greece. Brexit will do enough damage to UK trade as it is. Making it more difficult for people to travel around Europe would aggravate the problem.

Furthermore, it would clearly be absurd to require visas from the rest of Europe when we don’t ask for them from visitors from countries much further away. Why would we demand visas from Austrians and Belgians but not from Argentinians and Brazilians?

UK visa requirements

Map via Wikipedia

In all likelihood, after Brexit, travel from the EU will be like it is from any other non-visa country. People will turn up at ports, airports and stations, have their passports checked and be waved through. All that will be different is that the EU fast-track lane will probably disappear.

Much of the UK’s immigration control has nothing to do with borders. If someone arrives from a visa-free country they can stay for 6 months provided they can support themselves. It’s that last bit that’s important. Most are not rich enough to do that, so, effectively, we control immigration through access to the labour market. As Jonathan Portes explained to the House of Commons Exiting the European Union Committee:

Ending free movement immigration control is not going to be enforced at the borders at all. It simply is not. We are still going to let people in, at Stansted and Heathrow, with French passports. They just will not have the right to work here, and that right to work will be enforced at the workplace.

As he said in a NIESR paper he wrote in November, talk of border controls is a red herring:

Immigration control (of EEA nationals) does not (mostly) mean border control. It does not seem likely that we would restrict EEA nationals’ right to enter the UK without a visa. A fully fledged visa regime for EEA nationals would be hugely disruptive to trade, travel and tourism – even leaving aside the obvious point that this would mean UK nationals would require visas to travel to continental Europe. And it would mean that they were treated worse than, for example, Americans or Australians, who do not need a visa to enter the UK.

This means that control over how many and which EEA nationals are allowed to work in the UK will not, in practice, be applied at the border in the vast majority of cases. As with other non-visa nationals,  it will be applied in the workplace; employers will have to verify that EEA nationals are entitled to work in the UK, just as they currently do for non-EEA nationals. Talking about ‘border controls’ for EEA nationals or reintroducing ‘controls’ over ‘who enters the country’ misses the point almost entirely.

Despite the rhetoric and imagery used during the referendum campaign, the vast reduction in EU immigration required by the Conservatives would not be enforced by an army of border guards. Instead, it would be enforced by an army of recruiters around the country.

The EU accounts for about half of all migration and the majority of migration for work. Any significant reduction in migration therefore means that it will have to become a lot harder, and a lot more expensive, to recruit people from the EU. The Conservatives are already proposing to double the levy on non-EU workers. Whether similar measures would be implemented for non-EU workers depends on what is agreed with the EU but for the government make its migration number it will have to make employers jump through a lot more hoops. A cap of 100,000 doesn’t leave much room for manoeuvre. Last year the UK admitted 60,000 workers and their dependents on intra-company transfers alone.

This is likely to be especially difficult for employers in London. Earlier this year, Demos looked at the combined risks from loss of labour supply and loss of trade after Brexit. Their report drew similar conclusions to the one published in Regional Studies earlier this year (see previous post for a discussion of the findings). London is at less risk from loss of exports than other parts of the country. It is, however, a lot more dependent on EU labour.

When it comes to trade, London’s economy is globalised and less dependent on EU trade than the rest of the country. For its workforce, however, it is very dependent on foreign workers. According to Migration Observatory, 45 percent of all migrants self-employment  and 36 percent of all migrants in employee jobs live in London. (London accounts for about 14 percent of total UK employment.)

A cap in immigration is also likely to hit particular sectors very hard. Food manufacturing, hotels, restaurants, distribution and care homes are particularly vulnerable. An immigration cap of 100,000 would create not only a skill shortage but an overall labour shortage. There just wouldn’t be enough people to do all the jobs. The employment rate among the UK-born is already at a record high and even allowing for some underemployment, there isn’t much spare capacity there. As Torsten Bell says, the only significant pocket of unemployment is among the disabled.

Chart by Resolution Foundation

The burden of implementing the 100,000 net migration target, then, would fall on employers, in the form of additional migration-related cost and administrative workload but also in frantically re-organising workplaces and trying to work out how the hell to manage as the labour supply gets choked off. All of this will involve a significant amount of work and expense.

Will net migration ever really get down to 100,000? Who knows? Theresa May had the opportunity to quietly ditch the pledge at this election. The Conservatives are so far ahead in the polls that they could have dumped the policy without too much risk. George Osborne, in his new role as editor of the Evening Standard, described it as economically illiterate and claimed that no senior ministers support it. But Theresa May  is a woman on a mission, to change both the Conservative Party and the country. Might this be one of the things which she is determined to see through?

But even if the 100,000 figure is unachievable there will surely be pressure to significantly reduce migration over the next few years. Even a reduction by 100,000 would be difficult enough. It will be the job of employers to make that happen. UK immigration is controlled at the workplace, not at the borders. The rapid reduction in immigration will be implemented not by immigration officers but by HR departments. Cutting migration by more than half is a huge task but it will be employers who do most of the work.

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8 Responses to Employers: It’s your job to get migration down to 100,000

  1. Dipper says:

    Yes. Exactly. This is obvious isn’t it?

    The way I would hope this works out is that an employer e.g. the NHS has to go to the government and say it needs to take in x number of workers from overseas, whereupon a conversation happens where the employer explains what they are doing to encourage people in the UK to fill these roles, and then at some point a compromise is reached whereby the employer gets some leeway on immigration and in turn they have to start doing something to encourage UK citizens to work.

    For other industries e.g. farming, hospitality, I guess it will be the relevant trade association having that conversation, e.g. telling government they cannot employ British people on a low wage whilst the government continues to remove the incentive to work through working tax credits.

    Leaving the EU allows us to have sensible conversations about the balance between economic growth, immigration and promoting the interests of UK citizens. Surely that’s a good thing?

    As for the “paperwork”, employers already have all that when they recruit people from outside the EU, a process managed by HR now, so not a particularly significant burden.

    • Mick says:

      I think you miss the point entirely, the system needs unfettered immigration right now, no stupid brexit red tape, LOL!

      • Dipper says:

        I think you miss the point entirely. What the hell has happened that means we need to import enormous numbers of people just to function? How do you think pyramid schemes end? LOL!

        • Stefan says:

          Plenty of strawberries up here needing picked. Currently generally done by E Europeans living on site during their holidays. Not much in the way of HR depts or paperwork around here. Brits could step in no doubt but its a shit gig so why would they, i know I’ve did it.

  2. bill40 says:

    This argument reminds me of that around QE and ZIRP. I said look at Japan that’s what will happen, disclaimer, I mean of course I read it and claimed the thought as my own. I think it’s pretty fair to say that, to the astonishment of many, has come to pass.
    In the case of immigration I’d look to America and Mexico. No matter what actions America took they kept coming culminating in Trump’s never going to happen wall. Build it they’ll still come. People will always move to where they believe prosperity is, can’t find an official job, fine the black market will thrive.
    The only proven way to cut immigration to to trash your economy, then they won’t come. I don’t think anyone voted for that.

  3. dralfoldman says:

    Reblogged this on Dr Alf's Blog and commented:
    This is an excellent read. The problem with the Conservative Party Manifesto 2017 is that it’s light on detailed policy, cohesive strategy, costings, and risk analysis

  4. Pingback: How to earn £500k at a hedge fund without finance experience | | Arabic Press release - gulfnews

  5. Dipper says:

    BBC1 this morning. Steph McGovern interviewing folks in Carlisle. I caught (I believe) a woman who runs a road haulage business saying she needs EU Lorry drivers as she cannot get local drivers.

    The evolution of the Lorry driving industry in the UK has been well documented. Reduced rates due to the availability of Eastern European lorry drivers. Dreadful living and working conditions. Extra fees to get the CPC qualification just to earn less money. Young people not coming through to replace older ones who are leaving.

    The position of the Labour Party on this is “interesting”. Enhanced Trade Union rights, presumably so they can push up wage rates – otherwise what is the point? – whilst simultaneously welcoming importation of cheap labour to drive wages down. When all these contradictions hit the obvious brick walls, just take Jeremy’s patented anti-austerity magic beans, and if that doesn’t work just tax the enormous amounts of money that are carelessly left lying around for Labour governments to pinch and that can be repeatedly raided without consequence.

    FOM and immigration is the UK economy’s heroin. Our economy is hooked on it. “Experts” point out that coming off it is going to hurt. So best to stay on it, even though we all know where this will end.

    https://www.theguardian.com/commentisfree/2016/sep/05/secret-life-music-business-truck-driver-tom-jones-driving

    http://transportoperator.co.uk/2016/01/29/3568/

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