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.
Authors
- Pages
- 50
- Published in
- United Kingdom
Table of Contents
- David Cowan 2
- Tom Jones 2
- The views expressed in this report are those of the authors and do not necessarily reflect any views held by the publisher or copyright owner. They are published as a contribution to public debate. 2
- Copyright Adam Smith Research Trust 2024. Some rights reserved. 2
- Published in the UK by ASI Research Ltd. 2
- 23 Great Smith Street London SW1P 3DJ 02072224995 infoadamsmith.org 2
- Foreword 3
- David Frost The Rt Hon Lord Frost of Allenton CMG September 2024 4
- Executive Summary 5
- Selecting Fewer and Better 6
- Promoting Global Talent 6
- Ending Low Wage Dependency 6
- Supporting Automation 7
- Introduction 8
- Thirty Years of Mass Migration 11
- Macroeconomic Impact 11
- Microeconomic and Social Impact 14
- Case Study Housing 16
- Case Study Fertility 19
- Case Study Human Quantitative Easing 22
- A Progressive Consensus 27
- A New Direction 27
- Selecting Fewer and the Best 29
- Ending Low Wage Dependency 30
- Supporting Automation 38
- Boosting Capital Investment 41
- Promoting Global Talent 42
- Policy Recommendations 45
- Selecting Fewer and Better 45
- Reduce net migration to the tens of thousands 45
- Support annual caps on visa routes 45
- Abolish the graduate visa route. 45
- Retire the Shortage Occupation List cap the number of health and social care visas 45
- Raise the salary threshold to 40000 per annum and thereafter index the visa route salary thresholds to inflation 45
- Splitting the Home Office 46
- Ending Low Wage Dependency 46
- Scrap the BMAs cap on the number of medical training places available allowing the market 46
- Produce similar plans for other key areas of the public sector 46
- Re-establish the Resident Labour Market Test 46
- Abolish all state-sponsored immigration schemes for low-wage occupations 46
- Devise a range of incentives to enable domestic workers to meet public sector labour demands 46
- Remove the social care visa route gradually to give time for the market to adjust. 47
- Adopt stronger definitions of skilled workers with responsibility firmly in the hands of the Minister for Immigration 47
- Unfreeze student fees for UK students. 47
- Supporting Automation 47
- Introduce tax credits to incentivise private investment in robotics and automation 47
- Grant National Insurance holidays for companies that automate more jobs 47
- Provide tax relief for pension funds that invest in infrastructure and technological capital investment 47
- Expand technical and vocational training for fields related to robotics and automation 47
- Further attention and funding must be given to encourage takeup of STEM subjects 47
- The Department for Science Innovation and Technology should introduce a new annual award 48
- Boosting Capital Investment 48
- Revision of our energy policy to lower industrial energy prices 48
- Promoting Global Talent 48
- Auction out a limited number of work visas for foreign hires to employers 48
- Limit standard work visas to a maximum of five years residency 48
- Allow anyone employed for the whole five years to apply for indefinite leave to remain 48
- Restrict government welfare benefits and social housing from non-UK citizens and non-permanent residents 48
- Work and student visa holders should specifically not have access to Universal Credit 48
- Create a new guest worker programme for seasonal work that has no pathway to residency and citizenship 48
- Issue extremely limited rounds of work visas for highly desirable immigration streams 49
- Give automatic permanent residency to non-citizen tax domiciles who employ more than 100 people. 49
- Conclusions 50
