The Committee will continue to maintain a list of occupations that we are short of as a nation. We will want to ensure that the Shortage Occupation List is kept under regular review so it reflects the latest position in the labour market, and ensures the immigration system supports the Government’s industrial strategy.
This statement is lifted not from an old Soviet Politburo directive, but from the Government’s new Immigration White Paper, published in December. Even more remarkable is that the party in government otherwise claims to pride itself on supporting free markets.
Through a range of effective tariff and non-tariff barriers, the White Paper demonstrates a clear preoccupation in Whitehall with micromanaging the supply of labour in the British economy. This interventionist disposition is exemplified by the prioritisation of ‘skilled’ over ‘unskilled’ workers, the sponsorship system, and the imposition of salary and academic qualification thresholds on prospective foreign workers.
There are several reasons for this approach, not least the widely-held concerns that too much of certain types of immigration lead to wage depression, lower productivity, and a strain on public services. Superficially, these may seem reasonable but the truth is that they are largely misguided.
First, the assumption that migrant workers are necessarily in direct competition with the domestic workforce is wrong: rather, migrants often do jobs that domestic workers won’t or can’t do. Of course, there are instances where migrants compete directly with domestic workers in specific occupations or sectors — and that may well have an impact on domestic workers negatively in the short term.
But to believe that directly competitive labour cause wage depression and unemployment in the mid to long term, one would need to believe either that there are a fixed number of jobs in the economy, or that domestic workers are completely ‘immobile’. Neither claim stands up to scrutiny.
Second, the Government seems to believe that its interventions will increase productivity. This implies that — if left to their own devices — UK businesses lack the incentives to increase productivity — as if the profit motive had somehow disappeared. It also implies that lower-skilled workers do not increase productivity, which ignores everything we know about the benefits of the division of labour and specialisation.
Most incredibly, however, the Government seems not to realise that the productivity of any one individual would not increase just by removing other individuals from the labour force. Rather, all that would result is that some workers would be left without a job, and businesses would have a smaller pool of labour from which to recruit people.
Concerns about migration putting a strain on public resources do reflect real problems. But they are largely the result of other Government policies, not least those relating to our generous but inefficient welfare state. A paper I’ve just written for the initiative FREER, published today, sets out — alongside my proposals for improving the immigration system — thoughts about domestic reforms which would address voters’ anxieties.
The changes would not only increase the flexibility and mobility of the workforce (by removing the planning restrictions that make it so hard for workers to relocate, and by reducing the restrictive occupational licensing that has spiralled out of control), and reduce the burden on public resources (by allowing allocation to be more responsive, and by decentralising the fiscal system to make it more efficient), they would also take the strain off immigration policy.
Attempting to reduce the burden that immigrants might place on public resources is a sensible aim — but instead of having tighter controls on migrant ‘eligibility’, there ought to be tighter restrictions on migrant access to public funds.
It is not the job of those designing immigration policy to fix the economy, however. The command-and-control approach of the White Paper will not only make matters worse, it will distract from the real underlying problems and eat away at our freedoms.
The aims of immigration policy should be clearly predicated and achievable. To me, an immigration system should be focused on trying to maximise economic advantage by allowing the free movement of people. It should therefore only place restrictions on free movement either to ensure domestic security or to make sure the only financial incentive for immigration is to work.
Two main reforms would make this aim a reality.
First, the reason an immigrant comes to the UK should be irrelevant for the purposes of their application. If all migrants applied through the same migration route, not only would their freedom and flexibility be increased, it would also drastically simplify the immigration system, increasing comprehension and reducing administrative costs.
Second, migrant eligibility requirements as well as migrant entitlements, should be significantly reduced. The immigration system should maximise the freedoms and opportunities available to migrants, but should also place a greater emphasis on self-sufficiency and responsibility.
There are, of course, reasons to control immigration that go beyond economics. Socially, there are concerns about maintaining security and preventing criminality; culturally, there is the desire to be ‘cohesive’. The first of these seems to be a particularly legitimate concern, and, under my proposed system, deportation thresholds would be much stricter. Aiming for greater cultural cohesion, while increasing migration, is inherently more difficult.
If we are to be consistent and principled in our liberal convictions as a society, we ought to discriminate only according to morally relevant features. We ought to treat people as individuals, responsible for their own actions, and not those of any associated group.
Again, domestic reform is key to maintaining public confidence in the immigration system. If authorities dealt with all crimes committed by migrants with the same haste, transparency, and severity that they do for those committed by domestic nationals, much of the latent resentment towards certain migrant groups would thankfully dissipate.
In essence, I believe the state should play a reduced role in determining the quantity and type of immigration to the UK, and in assisting migrants. This would lead to both a freer and fairer system – and one which delivers sizeable economic benefits for the whole country.
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