Currently Theresa May has made stopping FoM a red-line issue even at the expense of the UK’s membership of the Single Market. Without a healthy flow of EU migration the UK economy is likely to grind to a halt.
The UK has 3.2m migrants from elsewhere in the EU living in UK. 2.2m of them are in tax paying employment. EU migrants overwhelmingly contribute more to the economy than their UK native counterparts and take out less (mainly because on the whole they are younger and healthier). Studies have shown that they do not drive down wages and do no significantly displace UK natives from jobs. This blog looks at the positive contribution our EU migrant workforce make to the UK.
A FactCheck study on these claims showed that EU migrants rather than being a drain on the UK bank balance actually contribute significantly, far more than their UK-native counterparts.
According to the European Commission, between 2004 and 2009 free movement from newer member countries increased the GDP of the old EU member countries by almost one percent. The author believes that this estimate understates the likely impact on the UK GDP as with a total Tax contribution of £8.54B in one year these migrants income would be in excess of £40B per year (assuming a 20% base rate of tax) and will be spending perhaps as much as £20B in the UK economy (on food, accommodation etc.) which equates to a 3% increase in UK GDP.
A further study showed that where UK-natives (during 2001-2011) claimed more than they paid in Tax the reverse was the case for EU Migrants who contributed significantly.
At a time when our UK native workforce have been taking out more in benefits than they put back in Taxes paid the EU migrants have put money into the economy, paid taxes far in excess of benefits claimed and perhaps most importantly have been providing the Labour to keep these services going. This has never been clearer than with the NHS and Care workers workforce. Without EU migrants theses services would grind to a halt – approximately 55,000 of the NHS workforce are EU Migrants with almost 10% of our doctors coming from the EU and 75,000 EU migrants work in the Social Care Services. Our public services depend on EU migrants by Alan Travis estimates that 600,000 EU Migrants work in the UK public Sector.
With regard to pressures on the NHS and other public services, any decline in services would seem to be associated with UK government cuts in the Public Services budget rather than from immigration. A study of nationwide immigration data shows that immigration actually reduced waiting times for outpatient referrals. On average, a 10 percentage point increase in the share of migrants living in a local authority would reduce waiting times by 9 days.
A Channel4 FactCheck on the topic concludes:
“The Office for Budget Responsibility accepts the basic point that immigrants tend to improve the country’s finances. A major cut in immigration would mean tax hikes or more spending cuts, the watchdog has said.
This is because migrants tend to be younger and healthier, so they are more likely to be in work and paying taxes and less likely to be retired or to need healthcare.