THE population of Britain is increasing at the fastest rate for 40 years, we learnt last Friday, an acceleration partly explained by a surge of migrants from Eastern Europe.
This influx, the Government had admitted only two days earlier, had exceeded its unrealistically modest projections, prior to EU enlargement, by, er, anything up to 600,000.
There was no way of giving a precise figure because the specially designed Workers Registration Scheme (WRS) for new European Union members excludes the (plumbing and construction worker) self-employed and is not required to keep tabs on workers who leave. Business estimates are that, over the past two years, the pool of available labour has expanded by 770,000 — two thirds of them eager young singles from Poland, Lithuania and Slovakia.
Meanwhile, UK unemployment is at its highest for six years, with 1.68 million people looking for work. In the year to last June, 243,000 were registered jobless and, ominously, April to June accounted for 92,000 of that total, showing a jobless level rising at rates not seen since the grim early 1990s.
The number on jobseeker’s allowance is climbing towards the politically sensitive one million mark. As ministers are quick to point out, this is not because the economy is not creating jobs, far from it; vacancies remain high and in the year to last June, employment levels rose by 240,000 to 28.94 million.
More people are at work in this country than ever before. Britain’s jobs market is less buoyant than it was, but still growing steadily. It’s just that it cannot keep pace with the soaring demand for work.
To many people, the maths is as unarguable as “two minus two equals nil”. There would be work for all, with better pay, if Britain had not — along with Ireland and Sweden but in contrast to the rest of the 15 earlier EU members — thrown open its doors to workers from the so-called Accession Eight, the countries that joined the EU in 2004. So long as wages are much lower and work harder to get in countries such as Poland, countless more will come. Thus controls must urgently be tightened — above all before the even poorer Bulgarians and Romanians join the EU and head here in their tens of thousands.
The fallacy that there is a finite number of jobs, for which immigrants “unfairly” compete, is a staple of immigration debates. It makes no more economic sense than France’s failed experiment with “creating” jobs by cutting the working week to 35 hours.
If workers from the EU’s eight accession countries (the A8) were taking jobs from locals, you would see unemployment claims going up in areas where WRS registrations were most concentrated.
This is not happening. Detailed, district-level studies led by Jonathan Portes, chief economist at the Department for Work and Pensions, show that the increase in non-migrant unemployment that can be attributed to a 1 per cent increase in the A8 workforce is a statistically insignificant 0.01 per cent.
As the chart shows, the A8’s migrants have almost all found work; yet non-migrant employment rates have held remarkably steady.
On the pay front, it may seem obvious that extra workers must depress wages. The newcomers’ pay packets are certainly modest: 78 per cent earn less than £6 an hour, barely half the national average. Most are processing fast food and packing poultry, waiting table and scrubbing floors, driving buses and looking after the elderly.
Since many of these sectors were short of labour, inflation would probably be higher without them. But with the possible exception of the building trade, a “grey” area at the best of times, and in a few areas in agriculture, blue-collar pay is rising at or above official inflation rates. So even at the lower end of the scale, wages and employment levels have been little affected by the influx of migrants. The newcomers’ gain is not the British workers’ loss.
What seems to be happening is consistent with studies carried out in America, where most work on the impact of immigration has been done. Extra labour enables companies, and even whole sectors, to expand, with output patterns changing in response to available skills.
If Britain were still militantly unionised, the newcomers would have been hard to absorb, but in a relatively liberal open-market economy, they are an asset.
So long as productivity does not suffer — and, apart from in the ballooning public sector, there is no sign of that — more workers mean more economic activity, higher tax revenues and, as the Bank of England’s Monetary Policy Committee acknowledged this month, a higher potential rate of growth.
What would have happened if we, like France, had tried to keep these migrant workers out after Accession Day? Many would have arrived anyway, and they would have done so entirely legally, because anyone with an EU passport can travel anywhere in the EU for stays of up to three months. Kick them out, and they can come straight back. The difference is that they would have worked illegally, as thousands are now doing on the Continent.
Take a look at that chart again. Before AD, there were already 89,000 working-age nationals from the A8 in the UK, but their recorded employment rate was only 57 per cent. After AD, the figure soars, in line with their access to the formal labour market.
It is in the black economy, where anything goes, that immigration is most likely to undercut wages and to squeeze the unskilled out of jobs.
We would do better to welcome the “Polish plumber” who so frightens the French. These newcomers are without question here to work; 97 per cent are in full-time, tax-paying jobs. They are not ghosts in the machine, but living souls who not only work, but consume, expanding the domestic market.
Because 82 per cent are under 34 and largely single, their demands on health services and school places are minimal, though that may change. Crammed into bedsits, they are having the time of their lives.
And so, thanks to their cheerful presence, are we Brits.
