Why Migration Matters

Remember Victor Spirescu?

A year ago today, Victor got off Wizz Air 63701 from Târgu Mures and into a media storm at Luton. He was one of the few Romanians and Bulgarians to take advantage of the end of immigration controls that had been in place for their countries since 2007. A flood had been predicted, some anticipating up to 5000 Romanians and Bulgarians a week, on into the future. There had been reports of “Olympic-style” security preparations and impossible burdens on the health services.

Victor Spirescu was polite but bemused. He’d been offered a job at a car wash outfit and came because “I love to work”. He hoped to make good money so that he could “renovate my home and make a good life in Romania because it’s much easier to live in Romania, because it’s not expensive”. He didn’t know much about the NHS.

In a report published this week, Oxford’s Migration Observatory shows how wrong these predictions of an invasion from Eastern Europe had been. It debunks claims that the increase in the allocation of National Insurance Numbers to Romanian and Bulgarian-born people in 2014 is evidence for a sharp increase in migration from Eastern Europe over the past twelve months; many of those allocated NINs over the last year were here before the European Union’s transitional labour market controls ended on 31 December 2013. The Migration Observatory instead uses Labour Force Survey data for Bulgaria and Romania (together known as the A2 countries). This provides a more reliable proxy for migration, and shows a steady pattern of increase over the years rather than the dramatic changes anticipated for 2014. While rates of migration have been increasing steadily, there is no evidence here that controls on movement within the European Union have made any significant difference. Which is another way of explaining why a quarter of the seats on Wizz Air 63701 were empty on 1 January 2013 and why Victor Spirescu was not one of many.

Migration A2 chart This said, the Labour Force Data does show that there are about 150 000 more Bulgarians and Romanians working in Britain today than in 2006. This is a small part of a broader trend. Census data shows that the numbers of foreign-born people living in the UK increased from about 4 million in 1995 to about 7 million in 2011. Most live and work in London but all major British cities are diverse; some 200 different languages are spoken in Manchester. This is a hot issue for all political parties and there is a general assumption that migration is a negative. A smart postgraduate student from Sofia asked me recently why British people hate Bulgarians (she’s making a documentary film about it); in late 2013 the President of Bulgaria made much the same point.

But is migration a negative? Leaving aside issues of rights, values, creativity and cosmopolitanism, the numbers again belie the assumption. A second recent report, this time from University College London’s Centre for Research and Analysis of Migration, shows that between 1995 and 2011, during which period the foreign-born population of the UK grew by about 3 million, migrants from within the European Union made a positive net contribution to the British economy of more than £4 billion. In contrast, the overall net contribution by native Britons was a whopping negative of £591 billion. And between 2001 and 2011 the net contribution of migrants from eastern European countries that have joined the EU since 2004, including Bulgaria and Romania, is estimated at almost £5 billion. Why?   Because, overall, migrants consume a far smaller proportion of government spending than the British-born population, making their tax contributions particularly useful when attempting to balance the national books. As the Economist puts it, migration is “the quintessential supply-side policy … It expands the labour force, encourages investment and provides taxpayers”.

This is the context in which to evaluate Theresa May’s support for further restrictions on the contributions that international graduates can make to the British economy. In contrast with other countries that are major destinations for international students, the Government has already raised visa requirements and removed the post-study work visa. The most recent proposal, trailed for the Conservative Party’s manifesto for this year’s general election, is to require all international students to return home immediately after graduation, and to apply for new visas for employment from there. In the context of the University College London study this is particularly short-sighted. International graduates, essential in key economic areas, will pay higher taxes than European Union migrants as a whole while drawing far less on state provided services than British nationals.

And Victor Spirescu? By May, when he was interviewed by Channel 5 News, he had had enough: “I speak with a lot of guys who want to come here and I tell them it’s not so easy to come here and to work here. I don’t want to stay here. I’ll go back to my country because I love my country, I love the place where I live.”

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Sources:

Banksy, 2013: “Migrants not welcome”. BBC, 1 October 2014, “Banksy anti-immigration birds mural in Clacton-on-Sea destroyed”.

BBC , 21 December 2014. “Theresa May backs student visa crackdown”

Channel 5 News, 14 May 2014:   “I want to go home: First Romanian to immigrate after rule changes regrets choice”. http://www.channel5.com/shows/5-news/features-archived/i-want-to-go-home-first-romanian-to-immigrate-after-rule-changes-regrets-choice

Dustmann, Christian and Tommaso Frattini, 2014: “The Fiscal Effects of Immigration to the UK”. The Economic Journal. Available from the Centre for Research and Analysis of Migration, University College London. http://www.cream-migration.org/files/FiscalEJ.pdf

Economist, 8 November 2014: “What have the immigrants ever done for us?”

Guardian, 1 January 2014: “Welcome to Luton: Romanian arrival greeted by two MPs and a media scrum”.

Guardian, 17 January 2014: “Romanian immigrant: ‘I just came to work, earn money and go home’.

Guardian, 29 December 2014: “No surge of Romanian and Bulgarian migrants after controls lifted”.

Migration Watch, 30 December 2014: “Bulgarians and Romanians coming to the UK in 2014: influx or exaggeration?” http://migrationobservatory.ox.ac.uk/commentary/romanians-and-bulgarians-coming-uk-2014-influx-or-exaggeration

Observer, 21 December 2013: “Bulgaria issues fierce rebuke to David Cameron over migrants”.

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