← The Rest Is Money
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Close your eyes.
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Exhale.
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Feel your body relax.
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And let go of whatever you're carrying today. Well, I'm letting go of the worry that I wouldn't get my new contacts in time for this class. I got them delivered free from 1-800-contacts. Oh, my gosh, they're so fast. And breathe. Oh, sorry. I almost couldn't breathe when I saw the discount they gave me on my first order. Oh, sorry. Namaste. Visit 1-800-contacts.com today to save on your first order. 1-800-contact.
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Immigration being the problem, putting pressure on services. How do I explain it to the people around me who all think that that is the problem?
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So I think most of the evidence suggests that the economic impacts of migration are relatively small. I think one of the challenges here actually is we all spend a lot of time talking about the economics of migration. The research suggests that that's not actually the thing that people care most about. People tend to care more about the social and cultural impacts of migration, but for various reasons, economics is a little bit more comfortable for people to talk about. They're less likely to be accused of being racist for ex if they're talking about these kind of more concrete economic impacts.
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B
So can I say it's not really going to have much of an impact if we massively change the immigration policy. We're delighted to say that this year the rest is money is being powered by octopus Energy. So Greg is back with us. Greg, I've got another question for you. So in terms of energy companies, are we just back to the big six?
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You know what, we've only got like six or so major supermarket chains. No one worries about that because they invest ferociously in competition. You've got differentiation. You know, we thought the market was stable, then Aldi and Lidl turned up. Competition is not about reinventing the souk with dozens of identikit companies. It's about companies having different approaches to looking after customers and competing ferociously on that. Energy could well be going that direction.
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Well, cheers, Greg, and thank you for powering this episode of the Rest Is Money foreign. To the Rest is money with me, Steph McGovern. Now, immigration is a hot topic, but what is the reality? Is it good or bad for the economy? And what are the politicians missing from the debate? It's not binary. It's way more complex than people often think. And so that's what we want to talk about. Also, are we heading for a brain drain? Well, today to talk about this, we have Madeline Sumption MBE. She is one of the UK's leading experts on migration policy. She's director of the Migration Observatory at the University of Oxford and is part of a group that advises the government on what's happening with people coming to and from the country. She's also written a book, what Is Immigration Policy? For a question I will be asking her. So here's my interview with Madeline Sumption. Madeline, it's lovely to have you here. As I've just said in the introduction, you're from the Migration Observer. I've got to say, whenever I hear that name always makes me think that you're watching birds. But you're not watching birds, are you? You're watching people in a way.
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Yes. Yep. People actually in our media monitoring software we have, when we get our results back, we have to screen out all the people. The bird related hits.
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Do you? Yeah, yeah, I bet you do. So immigration is such a hot topic, you know, it's being talked about all the time by politicians. It's rarely out of the headlines these days. What are the reasons people come and go to the uk?
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Well, there are lots of different reasons. People come as international students in many cases. Some people come on work visas or they come as family members of someone on a work visa or a student visa. You have people coming as the partners of British citizens. If a Brit marries someone from overseas, they can apply for a spouse visa for them. And then we have people coming as refugees, some people coming through the asylum system. Often they will come unauthorised, on a small boat or otherwise and then apply for asylum. Or sometimes they might overstay a visa and apply that way. And then sometimes, although slightly less now than a few years ago, people are coming on visas for humanitarian reasons. For example, people coming fleeing the Ukraine war. We also have a visa scheme for Hong Kongers leaving Hong Kong.
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B
What's the majority of them then made up of?
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Well, no single group makes up a majority and the biggest categories fluctuate over time. So there was a period when students were the biggest. There's been a period when workers were the biggest. If you look at the number of people coming in, then it tends to be that work and study are the biggest. However, refugees and family members are much more likely to stay permanently. And so actually, if you look over the long term at what's contributing to growth in the population, then it's more of an even balance with refugees and family members as well as workers and students.
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B
Okay, and so asylum seekers, in terms of this, what's the proportion of asylum seekers?
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So this has fluctuated a lot over time as well. We're currently in relatively high period for asylum seekers. We've had record high levels of applications over the last few years and they've made up sort of roughly 10% or so of overall immigration. It's going to be a higher contribution to net migration and population growth because asylum seekers usually don't leave. And that actually is the case regardless of whether their application is accepted. Whereas you have people who come in on work visas who often do leave, particularly people in it and various different tech jobs often just spend a couple of years and then leave again.
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B
So can you kind of set the scene for us on where we're at in terms of explaining what's actually changed in UK migration over the last decade or so?
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So the last decade has really been a bit of a rollercoaster ride. We had obviously the Brexit referendum at the the time. So in the 2000 and tens, most migration was coming from EU countries and the big debate was about EU membership. And then of course, when the UK voted to leave the EU, there was this assumption that migration was going to go down because free movement was going to come for an end and we were going to have a more restrictive system and EU migration did go down. But what happened at the same time was that the government made quite a lot of liberalizing choices on non EU migration. That then led actually to this extraordinary increase, a tripling in net migration, migration to the uk. So that's the number of people coming in minus the number of people coming out. So this unexpected and historically completely unusual boom in migration.
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B
So a lot more people coming into the country than there had previously been.
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Yes. Yeah. So before Brexit and before the pandemic, you had, on an average year, the net figure would be around in the sort of 2 to 300,000 range. And then it spiked up in 20, 22 and 3. So it hit a peak of around 900,000 in the end. And then of course, when the government saw what was happen, it slammed on the brakes and the previous government introduced a bunch of restrictions then to reverse some of the liberalizations that they had made. And now the numbers are plummeting back down again. We may actually go into a temporary period of unusually low net migration, basically because you've got fewer people coming in, but then you still have a lot of people who arrived a few years ago, international students and so forth, who are leaving. So we got this temporary period that we're just entering now where migration might look unusually low, but then probably it will bounce back to somewhere not so dissimilar, possibly even a bit lower than what we saw pre Brexit.
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Do you think we'll get to ever get during this time then to get to net zero? So the same people leaving as are coming here?
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Yeah. So I get asked about this a lot and it's really difficult to know precisely what the numbers are going to be if we do get to net zero this year, which isn't my main expectation, but if we did get there, it would be because a lot of people who were already here who arrived in 2022, 2023 as international students. If a lot of those people leave, if they can' find another visa to move on to, or they just choose to go home because they never plan to stay permanently, then we might see a period, a short period of unusually high emigration. But that's people leaving, that's people leaving. But I don't see any scenario in which we're at zero, anything close to zero for a long period of time. And I think, and that's. And probably people don't really, in debate, take this into account. People look at the numbers now and they assume that that's what we're going to have forever. But actually there's a lot of fluctuation and I think what we'll have relatively low numbers this year and possibly next, and then they will bounce up again to something a bit more normal by historical standards.
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So in terms of what has the biggest impact on the numbers, is it policy decisions by the government?
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It's a few things. So policy is really important, particularly for work and study related visas. So one of the reasons that we saw such high migration in 2022-3 was that there was some liberalization. So the government made it easier for students to work after their studies, for example. That meant a lot more students were interested in coming here, then they switched into work vis. There are other areas of policy where the government would really like to be able to influence the number of people coming, but it actually has a lot less control. The obvious case of this is refugees, people coming in small boats. So People are coming without permission. It's not sort of managed migration where the government's choosing to issue visas and successive governments have tried to put in deterrent effects or enforcement to stop that from happening, but really struggle. So I think policy is one factor, but there's a lot of other stuff going on as well.
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Just on that point about the kind of the legal immigrants versus the illegal ones, are they all part of the same numbers then? When we're talking about what's happening with migration, mostly.
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So if someone arrives on a small boat and claims asylum, they will be in the figures. But if someone arrives and overstays a visa, they might be accidentally counted as having emigrated. If the government doesn't pick that up. And there are going to be people who arrive and never get detected at all. And naturally they're not in the figures because they've never flagged up on any of those systems.
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Yeah, because I guess part of this is working out how accurate the numbers are in terms of people coming here. And how accurate are they, do you think?
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Well, they're much more accurate than they were. I think we have seen some improvements. The government is now doing something akin to counting people in and out. They look at the data from the border systems and from the visa systems. There are still some problems in the statistics, as I mentioned. If you have people who overstay a visa, they will often be counted as having emigrated from the uk, Even if they haven't. We also have big problems, actually, with the most difficult bit is measuring immigration and emigration of British citizens, because they're not getting visas and they can obviously come and go freely as they wish. The figures at the moment sort of assume they're trying to back out whether people have immigrated or emigrated based on whether they're receiving benefits or paying tax. So if someone goes quiet for long enough in the tax and benefit system as a British citizen, then they will eventually be assumed to have emigrated, even if actually they're just not in the uk.
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So they could still be at home. But they are seen officially as having emigrated.
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They could be, and the government statisticians tried to make some adjustments for that, but it's really difficult. So in future, I think they're gonna need to come up with some new methods to measure immigration and emigration of Brits, which even though it's not part of the bigger migration debate, it matters. If you're think about things like population growth, how is the population changing? We do need to know whether British people are coming and going.
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Yeah. And I guess, I mean, you can only work with the data you have. So you mentioned earlier about policy changes is one part of it, but there's lots of other factors that impact the movement of people. What else?
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Well, one of the interesting things is if you have a policy, even when your policy doesn't change, the number of people who take up that policy can actually fluctuate quite dramatically. So you have conditions in countries of origin and for work visas, for example, for example, if conditions get worse in countries of origin or better in countries of origin, that might affect whether people want to leave or not. For international students, which is actually quite a lot of our initial immigration inflows, things like currency really matter. So you had a currency collapse in Nigeria, for example, a couple of years ago, which made it much less affordable for Nigerian students to come to the uk, and that had an impact. Then, of course, when talking about refugees, you've got various different conflicts around the world. One of the contributors to the high levels of immigration just after Brexit was the Ukraine war and the government's choice to open up a visa for Ukrainians coming. So all of those things play in different ways and it's actually really difficult because there are so many factors. The government really struggles to predict precisely how many people are going to take up each visa and they give it a shot and they do try and project the numbers, but it is quite difficult. Which means that sometimes you sort of overshoot or undershoot compared to what they were expecting.
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Yeah. And there's a lot of discussion and headlines around foreign students at the moment and the pressure on universities and, you know, the concern that there aren't as many coming here. What's the reality in terms of what's happening with students?
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The number of foreign students, to be honest, is still pretty high. There was a little bit of a decrease very recently, but the numbers are still double what they were a few years ago. So you had basically a sort of steadily rising numbers of students before Brexit. The UK has always been quite an attractive destination for international students, even before, before we gave people the option to work after their studies. Then with the post Brexit immigration system, there was this graduate visa was introduced. So basically, if you study, you might do a one year Master's in the UK and then you would get two years of work rights where you can do any job. So that's much more liberal than the other work visas, which would require you to be doing specific types of jobs or have a high enough income. And so that made the UK more attractive, particularly to certain nationalities to Indian students and Nigerian students who tend to be most interested in work rights. And it also is one of the factors that increased recruitment of students at some of the less selective universities. So that, you know, that most selective universities were already basically recruiting more or less as many students as they wanted. And it was some of the less selective ones that then were able to use the post study work offer to bring in more people.
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So do you think therefore that the universities don't need to worry about still attracting foreign students?
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Well, they do worry about it. I think the challenge for universities is their finances. It varies obviously by institution, but the finances are often quite precarious. And a lot of institutions, the norm really is that they're losing money on teaching domestic students and they're losing money on research and so they make it up with international students. And one of the reasons the post study work visa I mentioned is one of the factors. But the other factor that led, I think, to increasing number of students was actually a lot of universities were just going out more aggressively recruiting overseas because international students pay much higher fees and so that helps them bring in revenues that subsidizes the rest of their corporations.
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B
Yeah, so, so that's a bit of discussion on, you know, who's coming and going. Let's talk a bit about what kind of what impact it has on the economy because that's the other thing that is often talked about in the news is, you know, is immigration good or bad for the economy? You know, one side saying, you know, they take jobs, they use our services, it puts pressure on things like the nhs, on welfare and everything else. And then the other side saying, actually it's really good for growth, for productivity, for labor, skill shortages and everything else. What' the reality?
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Right, so obviously the economy is complicated and there are lots of different ways of measuring economic impacts. Immigration obviously does increase gdp. That's not particularly surprising. If you have more people, they're producing more stuff. In fact, it would be really weird if you brought in more people and it didn't increase gdp. They'd have to be sort of, you know, destroying output somehow. So it's not particularly exciting to say that they increase gdp. More interesting is, do they increase GDP per capita or productivity or the things that actually determine how wealthy people feel? And there I think the jury is out. And if you look at average impacts, they tend not to be very big. I think the thing that probably gets lost most in the debate about economic impacts is that actually often it's who is migrating that matters more than how Many people are migrating. So people say, okay, well there'll be a, you know, if we have a decrease in migration, that'll be bad for the economy. I don't think that's right. If you had. So if you look at public finances, for example, which is one of the most measurable bits of the economic impact. So basically are people paying more in taxes than it costs to provide them with benefits or services like the nhs? You're going to have some people who are making huge net contributions basically if they're highly paid. So if you've got someone who comes in to it director or some kind of highly paid graduate job over the course of their lifetime, they're going to be paying potentially hundreds of thousands more in tax than it costs to provide them with benefits. If you have someone who comes in who's not working or who works in a very low wage job over the course of their lifetime, they're going to have a negative impact. Now the challenge for the government is that the people who, the groups of people who are most likely to have a negative impact are not the ones that they're admitting for economic reasons, it's the family members and the family members of British citizens and refugees. And so there's a trade off actually between the humanitarian goals, kind of ethical humanitarian goals and protecting families life and the economic impacts of that migration.
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B
Also there's the other argument I guess to this is, you know, the figures don't necessarily take any nuance of, you know, if you've got someone who is, who comes to this country, works in the care sector, they're low paid, so they're not necessarily contributing enormous amounts of tax, but they're providing a service and care that you can't really monetize, you know, so that there's. That it doesn't take into account things like that, does it?
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A
Yeah. So this is a really big issue in the care sector in particular, has been actually a huge part of the immigration story over the last few years because the previous government opened up a new route for people to come in on work visas and work in the care sector. Now the big challenge there is that the paying conditions in the care sector are really poor. And that is largely a policy issue because it's mostly public money that is paying for that. So the government effectively faces a choice. It can keep the paying conditions really poor and say actually we're going to just rely on migrant workers who are willing to do this work, miserable wages and in some cases, you know, if they, they used to be able to bring kids with them. You would have people who, if they came in with a couple of kids, they could well be pretty close to the official poverty line and obviously not eligible for, for benefits because they're on a, on a temporary visa. Really the choice is, you know, do you want to spend a lot more money to try and make the care sector a more attractive place for British people to work or do you want to, to bring immigrants into work in those jobs? Now, the challenge then in the long run as well is if you bring migrant workers in to do those jobs, if and when they get permanent status, they' move out of the sector for exactly the same reasons that British people move out of the sector. And so it's actually not clear how much. I think in the short run you get some saving by bringing in migrant workers to work in these quite difficult conditions, but in the long run it's less clear.
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B
Yes. So therefore it's the public finance pressure, because in order to make them more attractive to people, those jobs more attractive to people here, it involves paying more, which obviously costs public finances more and more. But inevitably, although that's a short term hit, in the longer term, that's got to be good for the economy though, hasn't it?
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A
Obviously there is a third option here which is just accept that people are going to have miserable care and just let the care sector and then I don't like that depression, really. And that's about people's dignity in older age rather than about necessarily a boost to the economy if you have better care. I think where you get the short run, long run trade off is the government brought in a lot of people working in the care sector, working obviously very hard, low wages. Now, over the course of their lifetimes, they would be expected to have a negative impact on public finances, because later on, not necessarily initially, but later on, as people get older, they use the NHS more themselves, eventually they'll draw a pension. So in some way, some types of immigration function, a little bit like borrowing in that you have more money now but you're storing up costs for further down the line.
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B
Yeah. So, you know, when you look at this then as a whole, and you're trying to work out what the actual facts are, when you see the headlines and you, for example, hear politicians talk about migration in terms of, you know, filling labor shortages, it's not as simple as that. That's the point. And so what is it that frustrates you? What's missing from those talks that you think you need to see more in the headlines?
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A
I Think it would be good if there was more recognition that we have lots of different types of migration. People often tend to talk about migration as if it's a single thing and it's good or bad and we can have more of it or less of it. And actually people are coming for these very different reasons for, you know, for work, for study, family members, as refug. And the reasons for those policy, for those immigration routes are different and the impacts are very different. Similarly, I think there isn't enough of a recognition that this is not all about the labour market. The people often talk about, well, what do we need? How many people do we need in these jobs or those jobs? And obviously that is part of the discussion. But actually a lot of migration that we have is not people coming because they were the worker selected to come on a work visa. Actually, most migration is people who have the right to work in the uk, but they're either coming as a family member of a work visa holder of a student of a British citizen, or is a refugee.
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B
So then talk to me then about ages of people then, if that's the difference in terms of the type of visa and things they're coming on, what are the ages of the people who are coming here?
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Well, migrants tend to be young, and that's generally across the world. Migration is a young person's game. People have fewer ties. It's just easier in your 20s or early 30s to move around before having children and getting married and so forth. That's the, the case in the UK as well. We see some variations. Obviously, international students tend to be among the youngest. And then you do get some people who come at an older age, people coming maybe for a few years on a work visa. Particularly a lot of people transfer from maybe an overseas employer to the uk and so sometimes you'll get older people in those categories. But broadly speaking, we're looking at people who are in, in their 20s and 30s.
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B
Okay. And so if there is, for example, you know, I know you're saying we're not going to go to net zero, but if we did go to net zero, what would happen to the economy?
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A
Not that much, to be honest. I think that. Well, firstly, I think if we go to net zero, it will be temporary and I suspect at the time that people won't really recognize this as much as perhaps they should. But I think, you know, broadly speaking, we had this period of, you know, very high immigration or net migration by historical standards, a couple of years ago will have a period of much lower migration. If you Average them together, it's probably still going to be a high rather than low number. And a lot of the people who are leaving. If we see more people leaving this year, a lot of them will be people like international students coming to the end of their courses or maybe coming to the end of their post study work visa. Having done a couple of years in the hospitality sector, this is not the kind of thing that's going to have major impact, impacts on the economy overall. You may see some impacts in industries like hospitality that have relied on some of those workers, but broadly speaking, I think that there will have been a blip upwards, a blip downwards, and then we'll go back to something pretty standard.
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B
So say we get to a point where in the next government it is, for example, if reform get in and they're very kind of anti immigration and let's say we get to a point where whatever policies they bring, it takes us below net zero. So there are more people leaving than coming into the country, what impact would that have on the economy?
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A
So if you have a much longer period of low migration, you might expect that to have more impact. But I think the key question is who is no longer coming? It's not so much about the numbers themselves. So in theory, and I don't think this is a likely scenario, but in theory, if you had high levels of emigration that were driven, driven by people who were not working or people on low incomes, then that would actually have a positive impact on public finances. If you have lower migration that's driven by fewer people coming in and highly paid graduate jobs, then that's going to have a negative impact. I should say one other thing is that the short run, long run is really important here, particularly for public finances. So I mentioned you've got some groups of people who, over the course of their lifetimes, it will cost more for them to use the NHS and receive any benefits they're entitled to, so forth, than they're going to pay in tax. But that's only over the course of their lifetimes, which is obviously we're looking at 50 years that people might live here if they stay permanently. In the short run, newly arrived migrants tend to have a positive fiscal impact. So you could end up with a situation where actually if you're living budget to budget, which I understand obviously is the case for many politicians, then lower migration can be a challenge in the short run, even if in the long run actually there would be benefits of certain types of migration being lower over the course of the decades.
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B
Yeah, and that's where it's so complicated because it all depends, as you say, on who is moving. So let's say then I'm going to just throw a couple of scenarios at you. Let's say if we have a policy which stops as many people coming to this country, but doesn't really change the number of people leaving it, how will that impact things? Will that. Because, you know, for example, if you look at unemployment at the moment, it's rising, isn't it? 5.2%. It's particularly high with young people. You know, it's the highest level it's been for 11 years. And there is a real problem with youth unemployment and even people who are economically inactive. Now, in terms of young people, we often talk about this million young people who are not in education, training or employment. Is there an argument, argument that if we had fewer people migrating to this country and they are, as you say, lots of young people, could it be a case that therefore the people in this country, the young people here would then have more employment opportunities? Because that is the argument essentially that parties like reform are making. Right.
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A
So there have been quite a few studies trying to look at, okay, well, what is the actual impact on people's ability to get a job or their wages, local workers as a result of migration, immigration. And one of the general themes in these studies has been that the impacts are much smaller than people expect. And the reason for that is that there isn't a fixed number of jobs in the economy. So what happens is if you have migrants come to the country and they will occupy jobs, but they also increase demand, right? They're out there, they're buying stuff and so they. So the UK produces more and that obviously requires someone to produce it. And so in the long run, really what immigration does is increase the size of the population, population. And that's not necessarily good or bad economically. Obviously, if you have very fast population growth or if you have negative population growth, then that can be a problem. But broadly speaking, you know, we don't become wealthier. If, you know, China is not wealthier than the UK simply because it's bigger. So that's in the long run, in the short run, there is a little bit of evidence that some people will see people particularly at the lower, with lower earnings. There are studies that have been able to identify negative impact on their earnings. The negative impact tends to be very small compared to, to other things. One study, I think found an impact of sort of like in pennies on the pound in terms of hourly wages. But there may be Groups where we're just not fully measuring it. The one group actually where we do see a larger impact is actually previous migrants seem to be most likely to lose out in the labor market as a result of new immigration. And that actually makes sense because they're more likely to be in similar jobs. They're more concentrated in jobs that don't require very high levels of language ability and so forth.
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B
It's so complicated, isn't it? And that's the point. But it often, you know, I live up in the Northeast. There's a real problem with deprivation in the area, as there are in other parts of the country as well. It's not just specific to us. And there's, you know, a lot of momentum at the moment, popularism around immigration being the problem, and that's what's going to make their life better, is if we have fewer immigrants to taking jobs, putting pressure on services. What do I need to say to them about what the reality is in lay terms? How do I explain it to the people around me who all think that that is the problem?
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A
So I think most of the evidence suggests that the economic impacts of migration are relatively small. I think one of the challenges here actually is we all spend a lot of time talking about the economics of migration. The research suggests that that's not actually the thing that people care most about. People tend to care more about the social and cultural impacts of migration, but for various reason is a little bit more comfortable for people to talk about. They're less likely to be accused of being racist, for example, if they're talking about these kind of more concrete economic impacts. But I think when you get into the social and cultural impacts of migration, this is obviously incredibly difficult to measure. It's really in the eye of the beholder. It's people's personal experiences that matter, not just what the data.
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B
So can I say them from what you're saying, and I know you're probably going to say no, that's too simplistic. But can I say to them it's not really going to have much of an impact if we massively change the immigration policy.
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A
Well, an impact on the economy or on.
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B
Yeah, on economics?
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A
No, I think immigration policies do matter. It's very easy for immigration policies to make immigration higher, as we saw in the last few years. It tends to be harder to make immigration lower, particularly if there are people who are currently eligible for visas who will then stop being eligible. That tends to be more controversial for various reasons and. And all sorts of reasons that the government sometimes struggles to do that. So I wouldn't say that the immigration policy doesn't make any difference or that it's not very important. I think it's not a very effective way to influence the labor market. Even a sort of medium sized change in immigration policy is not going to have huge impacts. There can be some slightly bigger impacts sometimes on public finances, but I think, yeah, it's just really complicated and often the impacts are smaller than people expect on both sides. Right. So we get the sort of, you know, immigration's gonna destroy the economy argument and then we get the, you know, we massively rely on we can only survive. The economy can only survive because of immigration. And I think that both of those really are exaggerations.
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B
Yeah. There's loads more I want to ask you in terms of the impact on businesses, also the, you know, potential brain drain and the wealth drain and all these other fancy buzz terms that are coming out for it. But let's go to a quick break.
- [32:39]
A
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- [33:34]
B
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- [34:37]
A
Yeah. So this has changed quite a lot over the last few years. Obviously, when we pre Brexit, when we had free movement, a lot of EU citizens were coming to the UK and they were. They worked obviously across the. The whole labor market, but they were particularly concentrated in lower wage sectors. So for example, hospitality, some kind of logistics, transportation, some of those, those industries. Now what's is then when we brought free movement to an end, when the government ended free movement, and the expectation was actually that sectors like hospitality, you know, lots of different kinds of manufacturing, construction, that they would be hit by that because they would not be able to recruit as many people, because we were going to have this more selective system where people had to be in graduate jobs or earning a certain amount. That experiment in sort of radically cutting off the supply of migrant workers in lower jobs, never happened because we had so many people coming as family members of workers, as family members of international students, that actually the growth in some of those sectors, the sectors that we expected to be hit, like hospitality, in fact just continued merrily recruiting very substantial numbers of people. Just it was non EU workers instead of EU workers.
- [35:52]
B
Oh, that's really interesting. So it was people coming here through a visa with these kind of tighter requirements, but along with them is their family members who then took on the jobs that didn't have the same visas that they would have done in the past.
- [36:06]
A
Right, exactly. And so what we've seen is all of the projections before the government knew that there was going to be this big increase in non EU migration, the projections suggested that certain industries would see much tighter recruitment of migrant workers. That basically didn't happen then. In addition, there were a few sectors where there were people coming specifically on work visas to work in those sectors. The most dramatic example here is the care sector, where half having gone from a situation where they relied to some extent on free movement, but it wasn't sort of major source of recruitment in the CARE sector. Then a visa opened up that allowed CARE employers to bring in very motivated people working in poor conditions on low wages from non EU countries. And the demand for that was huge. A lot of people wanted to come to the uk, A lot of employers, because they'd been facing shortages for years, wanted to hire them. So there was this boom in recruitment in the care sector. Many people going into the care sector. There was also actually a lot of abuse and exploitation of that route. And so you had people who came in thinking that they had a job lined up in the care sector and actually they didn't. And it was chaos. There was a huge mess in that sector in terms of exploitation. Then the government cranked down, starting late 20, 23 or so, and then under the current government, the route was actually the care route was closed to overseas recruitment entirely. So you had again sort of roller coaster where you had, you know, the massive increase in the availability of visas and then a crackdown. So that will. And that will start. There are still quite a few people who've been displaced in the care sector who these people who didn't have thought they had a job lined up and didn't and they can still move into new care jobs. But over the next few years we'll start, in theory, we'll start to see tighter situation for employers trying to recruit migrant workers in the care.
- [38:00]
B
So are they here, those people who were promised a job and then it didn't materialise, Are they here legitimately?
- [38:07]
A
Yes. So there are various different kinds of compliance problems. There were some people who, you know, there were some issues. We don't really know what the scale of this is. People who came in, for example, were as dependents, partner, for example, of a worker, but they weren't actually the partner of the person. So there was some of that type of abuse where people, the workers themselves knew that it wasn't legitimate. But there was a lot of cases where people thought that they had a legitimate visa and job lined up and in fact, and the visa was issued to them, but when they got there, it turned out that the employer didn't in fact have jobs. Sometimes there were cases where employers would bid on contracts with local authorities and they would bring in the workers to do that, but then they didn't get the contract and so they had no hours to offer the workers. You had so many employers entering this system that a lot of them, either through incompetence or malice, just they weren't complying with the rules. You're not allowed to offer a zero hours contract to someone who's on a work visa. You tell the employer, I will tell the Home Office, I'm going to guarantee pay of this amount. These are going to be the hours, this is going to be the pay and people just weren't doing it.
- [39:16]
B
And so what happened to those people?
- [39:18]
A
Well, they were in big trouble. And so, you know, many cases they might have been in debt from having so that, you know, perhaps they sold their house at home and they might have paid legal recruitment fees or you know, paid to various middlemen along the way. And so some of them ended up working without permission in other sectors, you know, hospitality or service stations, these types of things. So there have been cases of people being picked up in immigration enforcement operations who turned out to have a visa. It was just that their employer wasn't offering them the work. Some people were homeless, some people will have left the country. So that has been really difficult obviously for those individuals for the government to manage. And I think it was partly just the scale of the recruitment that happened meant that oversight was incredibly difficult.
- [40:12]
B
Yeah. And do we know how many of those people there are?
- [40:15]
A
We don't have recent numbers. The government estimated a little while back that it was a number in the low tens of thousands of people had been displaced from their. So you know, we're not currently working with their employer. But then there are also people who would like to leave their employer who, you know, they're in a job and they're being paid maybe not as much as they should be that they're with an exploitative employer. And so those people would not be in an of those statistics because their sort of employers are partially compliant.
- [40:42]
B
Right. So I mean it sounds impossible to police them, but surely the employers could be found out who they were given that they'd brought in these people and there must be a paper trail. So did the employers get in any trouble here?
- [40:56]
A
Yeah. So if they get found out, then the employers get in trouble and their license can be revoked. And there has been a spike in the revenue of employers licenses to sponsor workers from overseas. Some of them then just come back in. So they get struck off for 12 months and then they can just reapply and do it again. In some cases the degree of exploitation would sort of amount to modern slavery and then they might be, they could potentially be prosecuted in other ways. But I think the challenge for the government, this system, it was what for decades this was a system that was mostly aimed at graduate jobs where the enforcement was relatively light touch. There were problems here and there, but most employers tended to be reasonably legitimate, bringing people in, paying the wages and so forth. And then when it opened up to the care sector in particular, because it's already a high risk sector for exploitation and you've got a lot of smaller employers who don't necessarily know how to comply with the rules and others who don't care to comply with the rules. That's really, I think where you start again getting these. But it was not a sector that was necessarily particularly well suited to having the responsibilities of sponsoring and complying with immigration and employment law.
- [42:14]
B
That's interesting that you're suggesting that some of the businesses wouldn't necessarily have known they were doing something wrong then. Like the small businesses.
- [42:21]
A
Yeah, I think, I mean, I think there's a spectrum of non compliance. There are people who absolutely know that they're doing things wrong and are doing things like threatening their employees. You know, if you go to the police then I can get you deported, those types of things. You know, they know that that's not legitimate. And then I think you have a spectrum all the way down to sort of smaller non compliance. You know, they don't necessarily realize that they need to, to pay, you know, exactly what they've said. If the person is, is working less, I mean they should, you know, they have a responsibility. And the law says, I'm not saying it's okay if they didn't know. Right. Because the law says you need to be on top of this and, and make sure that you're following the rules.
- [42:56]
B
They're like not paying taxes. Do we know how many there are of these employers then where they've brought people in who've then being displaced? Are there any stats around that?
- [43:05]
A
There are some stats suggesting you've got hundreds of licenses that were revoked, but we don't. There, there will be other forms of non compliance that have just never been picked up. If the Home Office has never come to the attention of the Home Office then, then that won't be any in any statistics.
- [43:21]
B
Can I talk to you about something else that's you know, doing the rounds at the minute, the brain drain. So this idea that we've, you know, ONS figures are showing that three quarters, I think of the year UK nationals who are emigrating are under 35 and there's this suggestion that they're going off to sunnier climates in terms of, you know, greater wealth elsewhere and everything else. Is that, is that true? If we're, you know, is there a danger of us having a brain drain?
- [43:50]
A
So it's always been the case that we have net immigration of British citizens. So you have more people leaving than coming back. And that makes sense. This is a country that produces British citizens. So on average you would expect more people to be leaving lot A any given year than coming back. The big problem here is we just don't have good enough data to know how that's changed over Time. The reason that we're all talking about it now is that last year the Office for National Statistics changed its methodology. So it has a new way of measuring them, of measuring people leaving that picks up a lot more people. I suspect that their methodology is picking up people who have not actually left. Basically, if you're not engaging with the tax and benefit system for long enough period, then you will be assumed to have emigrated. And so I think the numbers are probably the most recent numbers suggested more than there was a net emigration of more than 100,000. That's not totally off the charts compared to historical periods. So we have much more accurate data for the 2010s which suggested that the figure was more around the net figure of maybe 80,000 leaving. I think it could well be when we eventually get to the bottom of the data, that actually nothing's really changed and that this is pretty stable somewhere around 80,000 over time. But we just don't know, and we don't know very much about the characteristics of people who are leaving. Are they people who would have been tremendously successful high earners here, who would be contributing to public finances? Are they people without jobs in general? It's often there's people with more resources who are better able to migrate. And so probably on net, I would imagine that, that immigration is going to be negative for public finances because it will be more likely to be kind of higher paid people who have the opportunity.
- [45:43]
B
So it could be a case that things haven't changed. It's just the way that we measure those people has changed, which is suggesting that it looks like there are more.
- [45:52]
A
Yes. Yeah.
- [45:54]
B
And I mean, it's a shame we don't do like an exit interview, isn't it? When people go and just say, well, can you fill out all the reasons why you're leaving? And then we have to do that.
- [46:02]
A
Yes, that's the reason for the new methodology. I mean, it wasn't so, you know, it wasn't really a. We didn't kind of give them the opportunity to grumble about whether it was tax policy or, you know, they didn't like the government or that kind of thing. But we did ask, there was, you know, data collection that would ask, you know, what's the reason for leaving. And so people would say if they were going to study or going to work and what, we would know some stuff about them. But that data collection then ended and the challenge is that there hasn't been anything sufficient to replace it.
- [46:31]
B
So when people do leave, the only way that you know they've left is because they just stopped paying taxes or are not part of the kind of the benefits or whatever the system is that they're. And that's the only way, you know, they've gone.
- [46:45]
A
That is currently the method that the government uses. The Office for National Statistics is exploring other options as well. In the long run, if you have a census, you can then reconcile it, right? You can say, okay, well, this is how many people we had in 2011, this is how many people in 2021. And so you can work out from that how many people must have emigrated if you know how many people were born and died in the meantime. And that will presumably happen again when we get the next census in 2031. But obviously we've got quite a few years until then.
- [47:15]
B
So we don't necessarily think there's a brain drain. What about the wealth drain? So there's the idea that there's lots of, I don't know, or millionaires who are leaving because of whether it's to do with tax policy or whatever it is. Is that happening? Are we seeing more rich people leaving?
- [47:29]
A
Yeah, this again, we just don't have the data. Unfortunately not. So we have bad enough data just on the overall how many people are leaving, but we know even less about who it is, who's leaving and how wealthy they are.
- [47:40]
B
Unfortunately, yeah. Do you think, I mean, because anecdotally, lots of people are talking. I know you don't deal in anecdotes in your job, but what do you think, looking ahead to immigration? Do you think we're to going. Going to see more people leaving who are, you know, who are richer? Are we going to see more people leaving in the brain drain sense, or is it just impossible to predict?
- [47:58]
A
I think it is basically impossible to predict. There is some research on why people leave and in general, as I mentioned, it tends to be younger people who leave. Very wealthy people. Yes, in theory. You know, there are these stories about people going to live in tax havens or what have you. There's actually quite big barriers to very wealthy people moving, which is that it's their networks and their social capital and everything they know about the place where they are that has enabled them in many cases, to become rich in the first place. And so you can't necessarily just uproot yourself and be just as successful in some other country. Plus, by the time people are very rich, often they're, you know, 50 plus, at which point they may have children in school, you know, they've got lives as well as you know, just money. And so in practice it's often that case that people find it more difficult to move than you would expect, even if they can get a more beneficial tax policy somewhere else.
- [48:56]
B
So I can see next year you've got your book, which is coming out soon. What is immigration policy for? What is immigration policy for then?
- [49:06]
A
Well, one of the challenges is it's for many different things. So the government is trying to achieve all sorts of objectives. They've got economic objectives, there's social and cultural impacts, there's humanitarian and ethical considerations. And basically in the book, what I argue is that because they're trying to achieve quite a lot of things with a set of tools that don't always work and that are quite limited and their goals conflict. So you might often get a conflict between the humanitarian objective of refugees and the fact that actually refugees need a lot of support so are not going to be positive from an economic perspective. So what I'm trying to do in this book, I'm trying to basically just be as fair as possible to the arguments on each side of the debate and sort of explain, you know, what can we genuinely say, we know, what are we less sure about and why is it so difficult to come up with a policy that people are happy with?
- [49:58]
B
Yeah, because I mean, part of your job is to make migration debates more evidence based, aren't they? So what I guess is your biggest beef in terms of misconceptions about immigration frustrations and things. What, what's your, you know, in terms of what it's used for and what it isn't used for, what's your biggest beef?
- [50:18]
A
I think probably the biggest challenge is that quite naturally people find it very difficult to recognise the trade offs, that the evidence rarely unambiguously supports a particular position. Every policy has pros and cons and it has winners and losers. And I think that we see on both sides of the bait, both the sort of skeptical side and the pro migration side, that people are anxious about accepting any counterarguments to their policies. And I understand this, right, especially politicians, they have to sell their policies and okay, there's some chat about, well, there are difficult choices, so you do sometimes get that recognition. But I think it's genuinely quite difficult to admit this policy is not perfect. It does have some drawbacks, but I think the public debate more broadly can do that and that we could all do more. I think, to be honest, about trade offs, that there's never a perfect answer and you're going to have pros and
- [51:16]
B
cons in either direction which feels it always gets left out of debate. Doesn't feels like it's quite binary at the moment and that's not the reality is what you're saying. Madeline, thank you so much. It's been lovely to chat to you. And your book is out in March, isn't it?
- [51:31]
A
It is. It's called what is immigration policy for Exactly.
- [51:33]
B
And you can pre order it now. Pre ordering always helps authors. So do pre order it if you can. There's lots of good deals on it. There's minute with the book sellers too. So have a look, see if you can get it. But thank you very much, Adeline. Lovely to see you.
- [51:46]
A
Thank you.
- [51:46]
B
That's it for the rest is money. Bye bye.
- [51:54]
A
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B
to some, he is the revolutionary hero who restored China to its rightful place
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B
To others, he's a brutal despot accused to presiding over more civilian deaths than either Stalin or Hitler. Mao Zedong has one of the most recognizable faces in the world. Yet he started life in a muddy provincial village. A rebel son who hated his father, survived a 6,000 mile walk across China and rose to become a figure of titanic proportions from Empire. The Goal Hanger World History Show.
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A
I'm Anita Anand.
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B
And I'm William Durham. In this six part series, we're joined
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A
by world renowned expert Rana Mitter to explore the life of the father of
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B
communist China, Mao Zedong.
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A
We'll track his rise from a bookstore
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B
owner to a guerrilla commander. And we'll witness his ruthless elimination to secure total power.
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A
And we'll descend into the dark experiment of the Cultural Revolution. A time when ancient temples were burnt, children died, denounced their parents, and a
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nation worshipped a mango as a sacred relic. Subscribe to Empire wherever you get your
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A
podcasts to listen now.