Journal Column

23/09/2015

Graham Robb

NE Chair of the Institute of Directors

Senior Partner, Recognition PR

The response by many councils to the refugee crisis on the borders of the EU has been generous and appropriate, adopting the usual friendly and welcoming approach so common among the people of the North East.

This humanitarian crisis is slightly different to the wider issue of economic migration; many refugees caught up in the rush to the EU border are fleeing the terror of IS in Syria and the privations brought upon the region by war and sectarian conflict. The Government has changed its position on refugees, the debate is about how many to welcome to the UK and how we spend our aid resources, my personal view is that the Prime Minister is engaged and is getting it about right.

However, the wider issue of immigration policy is something that the Institute of Directors has strong disagreements with the Government about.

The North East of England is not a magnet for migration. Of the roughly 2.6 million people who live in the region, only 130,000 were born outside the UK. That is around 5% of the population, the lowest for any region or nation of the UK. The average for England as a whole is nearly three times higher at 14%, although the figure is dragged upwards considerably by London.  

Nor are people moving to the North East from other parts of the UK. In the year to June 2014, 44,000 people moved into the North East, but 43,800 left. This was unusually stable compared to other English regions, where the story is largely one of people leaving London and moving to other parts of Southern and Eastern England.

These factors combined meant that last year, the population of the North East grew by less than any other English region, at only 0.32%.  A population that doesn’t grow is an ageing population, and one where the number of people of working age shrinks as a proportion of the whole. 68% of the population of London is between 16-64, but the figure is only 64% for the North East. This is far from being terminal decline, but the further this percentage drops, the harder it becomes for people in work to provide the tax revenue needed to pay for public services, particularly pensions.

At the IoD, we believe that skilled and motivated people from outside the UK can play a vital role in ensuring the UK’s future prosperity.  For this reason, we think the Government’s net migration target of ‘tens of thousands’ is arbitrary, misguided and counter-productive. The government should drop – or reform – it as soon as possible.

Since the UK is a member of the EU, the only feasible way for the target to be met is off the backs of skilled non-EU migrants, a reduction in the number of international students or through a significant increase in emigration. Three solutions very few people want.

We need a mature approach to discussing immigration. The public has concerns over levels of immigration. Two-thirds of people think immigration brings both pressures and economic benefits. Only one quarter think immigration is wholly negative. However, the public’s concerns are linked to the country’s ability to adapt and integrate. People fear pressure on public services, housing, school places, hospitals, and above all else, jobs.

The perception that immigrants come to the UK to claim benefits is misguided. Employment rates are higher among sections of EU citizens than UK nationals. 50% of IoD members hire from outside the UK, and only 4% of them say cost has anything to do with their decision. It is about skills, building trade links and bringing people with new ideas into the business.

If the Government feels wedded to the net migration target, then it still has options such as removing international students from the cap, who account for a third of all people arriving in the UK in any given year. International students bring £7 billion to the UK economy and 130,000 jobs. 60% of the public do not want the Government to cut international student numbers, and only one in five people think they should be counted in the statistics. This is the obvious place to start.

Obviously, it would be better if we had UK trained and qualified staff available to take on the roles that are vacant but that is something that takes more time. The vacancies in medicine, engineering, technology and science are free today and leaving them empty disadvantages our own firms.

The IoD wants the Government to instigate a Comprehensive Immigration Review, based on evidence and expert advice. We want to help set out a sensible plan for managing inward migration in a way which supports our economy, works for our businesses and addresses public concerns. At the moment, however, while everything is clouded under the arbitrary net migration target, that is not possible.



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