Selecting the Best: Building a Future-Focused Immigration System

David Cowan; Tom Jones

Since 1997, Britain has experienced significant levels of mass migration. In the 25 years leading up to Tony Blair’s election, the UK’s average annual net migration was 68,000. In the 25 years that followed, it tripled to an average of 236,000;High levels of immigration have helped to prop up the UK’s low wage, low productivity, low growth economy;Whilst gross GDP has been artificially inflated by a larger population, GDP per capita and productivity rates have stagnated;The actual fiscal impact of migration is quite small; estimated to only be between +1% and -1% of GDP;Research has also found that high levels of low-skilled migration has disincentivised investment in capital and machinery.Mass migration is not necessarily the cause of the UK’s poor economic performance- there are a number of factors at play, including our planning system, high energy costs, and over-regulation;But in many ways, it has been integral to propping up our current economic model, by acting as a subsidy for certain sectors, especially our universities and healthcare system;Using high immigration rates to counteract the change to Britain’s ageing population will be at best a short term solution. Low fertility is a global problem; by 2050, 75% of nations will not have above-replacement fertility rates;Mass migration is also unlikely to increase the UK’s fertility rate. Evidence shows that women’s fertility rates tend to converge with the host nation’s;Migration should come down to the tens of thousands. However, as this paper argues, for this to happen we must ensure that the economy can adapt to such a reduction;This report puts forward recommendations which would create a highly selective immigration system, attracting the best in the world, and which would accelerate our transition to a high-skill, high wage, high productivity and high innovation economy.