You probably know that immigration is when people leave one country to go live in another. And you probably know that people can migrate for all sorts of reasons: because they want to retire somewhere sunny, because they fell in love with someone of a different nationality, because they want to study abroad, because they’re running away from something terrible (this last group are sometimes called refugees, depending on whether the country they’ve fled to agrees that it was too dangerous for them to remain in the country they fled from).
People have always had very different opinions on whether immigration in general is good or bad, which types of immigrants (if any) are good or bad and who/what those immigrants are good and bad for.
In this article, we wanted to look at one claim about immigration that keeps popping up in countries like the UK. It says that low-skilled economic migrants (people who move for a job and/or a better life) push down the wages of low-skilled locals. Why this claim? Well, in 2018 the UK government said that it believed low-skilled migrants hurt the job prospects of locals and as a result it was going to severely restrict the number of low-skilled migrants it lets into the country.
Why does the UK government think low-skilled migrants are a problem?
The government based it’s new policy off a recommendation by The Migration Advisory Committee (MAC). MAC is a non-political public body who tell the UK government what their immigration policy should look like. They released a report in September 2018 which said it was true that low-skilled immigrants make low-skilled locals poorer, and that the British government should respond by restricting low-skilled migration. So the government said it would.
Hold up! What the heck does ‘low-skilled’ even mean?
Ah, well, actually, we’re not 100% sure. That’s because there’s not an official definition of ‘low-skilled worker’ that everybody uses. But generally people are referring to jobs that don’t require any special education or qualification to do: anything from farm labourers to bartenders to secretaries to shop workers to care home workers.
Of course, it can be controversial to call these jobs ‘low-skilled’ because lots of them do, in fact, require a fair bit of skill.
People also tend to use ‘low-skilled’ and ‘low-paid’ interchangeably. That can be misleading: you don’t need a PhD to be a Kardashian, but we don’t think Kim is short of a few bob. A report by the Centre for Social Justice (CSJ) thinktank claimed that only about half of low-skilled workers in the UK are also on low pay, which it defines as earning less than £16,500 a year.
Got it. So are all low-skilled wages going down because of migration?
So here’s the thing: we’re not actually sure if low-skilled wages in the UK are going down at all. In our defence, that’s because different studies seem to come to different conclusions. A report by that thinktank CSJ looked at the wages of low-paid workers (which, remember, is not always the same thing as low-skilled) and said these people’s earnings were staying low even as inflation (that’s the prices of all the stuff we buy) goes up. That means those people are indeed relatively poorer. And there’s a lot of anecdotal evidence from the people actually in these low-skilled or low-paid jobs that their wages are stagnating and they feel less well-off.
But then we have a website that tracks these things saying that the wages of low-skilled workers in the UK are actually going up - from about £1,280 a month in 2016 to £1,330 in 2018. So what’s going on? Was MAC’s complaint about migration pushing down low-skilled wages bogus? Maybe. But it’s worth pointing out that the other thing that happened between 2016 and 2018 was that a lot of low-skilled migrants left the UK. So odd at it looks on first glance, rising low-skilled wages could actually be evidence that immigrants do push down low-skilled wages.
Okay, quit with the suspense. Does immigrantion push down low-skilled wages or not?
Short answer: yes, it appears it does.
Lots of different people have looked into this, from MAC to the Bank of England to the Home Office, and all of them ultimately concluded that pay in low-skill jobs goes down when immigration goes up.
So the government is right? We should cut low-skill immigration?
Hold up, hold up - there’s more to the story. For a start, the amount that these studies found immigrants depress low-skilled wages is really, really small.
In the Bank of England report is says that a 10 percent increase in low-skilled immigration will reduce low-skilled pay by 1.88 percent. But it’s taken almost twenty years for all migration to Britain (including the skilled sort) to increase by just 7.2 percent (from 3.7 percent to 10.9 percent of the population). And that includes the period of time where Eastern European countries like Poland joined the EU and the UK was, to quote some tabloids, “flooded” with low-skill workers.
Of course the low-skilled Brits whose wages we’re talking about here have the right to be annoyed about any amount of pay reduction, regardless of how small it is. But the thing is that a lot of the people who are angry about their lack of wage growth are (a) not low-skilled workers, and (b) saying they’ve had a bigger salary drop than 1.88 percent in twenty years. And there’s evidence to back their claims up: research by the London School of Economics says the average British wage fell by more than 5 percent between 2007 and 2015. (After being adjusted for inflation, which basically means they took into account how much prices rose and therefore how ‘far’ the average wage would go in buying the stuff we need to live, like rent and food.)
To recap: low-skilled migration to the UK has dented some people’s wages. But something else has caused a wage reduction 2.5x as big, in less than half the time, to many more people. And if the UK doesn’t identify and fix whatever that something else is, UK wages - including low-skill wages - won’t rise significantly, even if all low-skilled migration is outlawed.
So if it’s not immigration that’s causing wage decreases, what is it?
Well, how about the great big financial crisis we had a decade ago?
Or the fact that the UK has outsourced a lot of low-skilled work to foreign countries?
Or all those cool machines and robots and AI computers that we’ve built and which businesses are using to replace workers, especially the low-skilled sort (remember when you only had humans to check you out at supermarkets?).
Or the failures of the British education system to (according to a lot of top-company bosses) give enough people the skills and training to succeed in the modern workplace?
Or the Brexit process, which some people say is slowing down our economy by making some businesses pack up and head to the continent, and leaving the ones who stay more reluctant to hire people or give out payrises?
But if low-skilled immigration isn’t that bad for wages, why is the government banging on and on about reducing it?
Because the British government needs to do what the British public want in order to stay in power, and a lot of the British public (71 percent of them, in fact) want fewer immigrants in the country. They particularly want fewer unskilled immigrants, particularly those from certain countries - just 5 percent of people want absolutely no skilled Indians, for example, but 42 percent want absolutely no unskilled ones.
And reducing immigration is something many Brits feel strongly about. In 2015, 56 percent of Brits said immigration was the most important issue Britain faced (that dropped to 21 percent in 2017 as people became more focused on Brexit).
Plus, wages are not the reason Brits want fewer immigrants. Research from the Policy Exchange (another think tank) says that opposition to immigration is ‘largely cultural and psychological’. To put that another way, the people the Policy Exchange surveyed didn’t want fewer immigrants because they thought they’d make them poorer. They wanted fewer immigrants because they didn’t like being around them, thought they were too different from them, or that they would dilute British culture.
So is it right to reduce low-skilled immigration, even if it doesn’t actually make people poorer?
That depends on what you mean by ‘right’. If you agree that there are too many immigrants in Britain, and/or think Britain should primarily be for the British and/or believe that foreigners don’t make good neighbours, then, yes, you should support a restrictive immigration policy. If you don’t believe these things but do think that democracy means implementing whatever opinion the majority of people hold, then you also have to conclude that the UK government should reduce immigration regardless of its impact on wages or other forms of wealth.
But there’s plenty of reasons that could make you decide that cutting back low-skilled immigration is not the right thing to do.
Such as?
Such as the fact that many businesses saying they need low-skilled immigrants to fill jobs that Brits don’t want or aren’t qualified for.
Or the belief that immigrants bring vibrancy and variety to a culture - the UK has them to thank for Chicken Tikka Masala, Tesco and fish’n’chips, for example.
Or perhaps because you think the benefits migration often gives the migrants themselves outweigh the costs put on British locals. Most low-skilled migrants who moves from a poorer country to Britain end up earning a lot more money and have many more career opportunities (not to mention greater personal safety and a better quality of life) than they would have had if they’d stayed. For many, that extra money allows them to work their way out of poverty and make a better life for them and their families.
Okay… so should I support reducing low-skilled immigration or not?
Ah, we can’t tell you that, sorry. Your feelings on immigration policy are for you to decide. We’re here to help you figure out all the different sides to the issue and cut through the bullshit, not to give you all the answers.
