Immigration expected to fall because of economy, not policy

A report, published on New Year's Day, has predicted that net migration will fall by tens of thousands this year. However, the report also suggests that this fall will be the result of economic conditions and not government policy.

The report, Migration Review 2011/12 was published by the independent think tank, the Institute for Public Policy Research.

The predictions made in the report (detailed below) include that net migration will fall to 180,000 in 2012 but the report is also highly critical of the impact the Coalition’s policy changes will have on this.

The report provides summaries and analysis of changes in migration numbers in the last year by immigration category, as well as predictions for how these numbers will change in the coming year.

Highlights of these summaries are provided below. Much of the following is quoted directly from the IPPR report.

Predictions for 2012

The government will decide early in 2012 on the settlement rules to determine who is allowed to stay. We expect the government to choose an income threshold of £35,000 for those seeking to settle. Although historical precedents suggest many immigrants who come as temporary workers end up staying, new rules are likely to have a limited deterrent effect on would-be migrants to the UK, though not enough to make a significant contribution to reducing in-flows in 2012.
Net migration – which was just over 250,000 in 2010 – will have fallen to around 220,000 in 2011 (official figures will not be available until later in 2012) and then to around 180,000 in 2012.
Official figures are likely to show that immigration started to fall in the second half of 2011, through a combination of policy changes (in particular on non-EU students) and worsening economic conditions. These trends are likely to continue in 2012 leading to a fall in non-EU immigration of around 10 per cent.
The Migration Advisory Committee will publish its recommendations on revising Tier 2, including the cap for the next financial year. The MAC will focus on intra-company transfers (ICTs), which were excluded from the cap in 2011 and which have risen from around 22,000 per year to 30,000 per year. The committee is likely to recommend either increasing the salary threshold (currently at £24,000 for six-month ICTs and £40,000 for longer-term ICTs) or disqualifying the use of ICTs by third-party contractors, or both. Further curbs on skilled migrant entry, including via ICTs, are unlikely to reduce overall numbers by much more than 10,000.
The government will continue to try to reduce numbers of non-EU students during 2012, largely in order to meet its overall targets.
In early 2012, the government is likely to announce the way forward on its proposals to restrict family migration. An income threshold of around £20,000 could disqualify around half of the roughly 50,000 who currently come to the UK via the ‘family route’. It is very likely that the changes to family migration will be challenged in the courts.
Emigration could continue to decline, or at least remain stable. Fewer people want to leave the UK for work-related reasons. Retirement and ‘lifestyle’ emigration by British nationals – which are highly dependent on UK house prices and pensions – are likely to continue their decline while people feel less confident about the economic outlook. Overall, it is unlikely that emigration levels will help to reduce net migration in 2012.
Asylum numbers will stay around the 20,000 per annum mark of recent years.

Summaries of immigration categories

NET MIGRATION

The report is critical of the choice of net migration as a target by the government:

‘The choice of target brings two risks. The first is that by promising what it cannot deliver, the government, far from achieving its stated aim of taking the heat out of this emotive issue, will instead feed the public’s sense of disillusionment. The second risk is that the target will distort policy choices ... the most troubling area, at a time when returning to growth should be the UK’s top priority, are the wide-ranging changes to economic migration.

‘A recent survey by the Migration Observatory showed that the public h2ly support the Coalition’s overall aim of reducing immigration, but equally h2ly doubt they will deliver it, and do not support their detailed policies.’

WORK MIGRATION

The report says that ‘non-EU work migration, which has long been declining as a proportion of overall immigration. The number of work visas granted each year fell from 250,000 in 2005–06 to 150,000 in 2009). The cap wasn’t filled in 2011 due to depressed economic conditions, but IPPR remains concerned that it could be a drag on economic performance in the longer term.’

STUDENT MIGRATION

The following is taken from the report:

‘Foreign student numbers have more than doubled in the last 10 years, to around 240,000 in 2010. The government plans to curb these numbers substantially, and has estimated that the changes it made to student visa rules during 2011 – including new English language requirements and tougher sponsorship requirements for colleges – have already reduced the number of overseas students by 11,000. Here, as in other areas of immigration policy, it is the overall target for reducing net migration that is driving the changes.

‘Cutting down on abuse of the student visa system is a legitimate objective, but it is fundamentally different from cutting down on numbers. Better targeted action against visa scams and bogus colleges would restore public faith that the great majority of those coming on student visas are genuinely here to study. This would then enable the government to remove students from the ‘numbers game’ generated by the net migration target and to move back to a policy that supports rather than penalises one of our most important industries and sources of future growth and global influence.

‘Our competitors in the international market for higher and further education are going in the opposite direction. Higher and further education is worth £28 billion in exports for the UK each year, according to a 2007 estimate by the British Council, and offers one of the few prospects for immediate growth, with some estimates measuring its potential at 4 per cent per year over the next four years.’

FAMILY MIGRATION

‘Far from being out of control, family immigration is already declining. But ministers need it to fall faster if they are to hit their target.’

The report also notes that the new income thresholds proposed by the Migration Advisory Committee, which are likely to be brought into force this year, are ‘another example of wider immigration policy being distorted by the net immigration target.’

EMIGRATION

‘Emigration reached its lowest calendar-year figure since 2001, at 336,000 in the year to March 2011. Fewer people are emigrating from the UK for work-related reasons: just 174,000, the lowest for five years and down from 203,000 in the year to March 2010. British emigration has been declining since it reached a peak of 207,000 in 2006: the number of British nationals leaving the UK in 2010 (136,000) was the lowest for over a decade, though the very latest estimates suggest this trend may be levelling off.’

SETTLEMENT

The report is particularly critical of elements of the government’s strategy to reduce the number of people achieving settlement in the UK:

‘The government wants to turn the majority of economic migrants into temporary workers: they are welcome to come and fill jobs where we lack the skills or people willing to do the work, but after five years the majority will be asked to leave, regardless of the contribution they have made.

‘IPPR has argued that while there is nothing wrong in principle with trying to shift the balance of migration towards the temporary, the proposed approach is the wrong way to go about it.

‘At the very least, any such policy requires a serious analysis of the issues around compliance, incentives, and enforcement – issues which are entirely absent from the government’s proposals so far.’

‘ILLEGAL’ OR IRREGULAR MIGRATION

Given the government’s hardline stance on abuses of the immigration system the IPPR report suggests that little headway has been made. This goes against the impression given by the widely publicised stories of success published by the Home Office and UKBA.

According to the report, ‘Numbers of irregular migrants recorded as being ‘removed’ appear to be increasing, but a closer examination of the figures shows that this is not the result of enforcement activity but of an exercise in ‘data matching’, including the e-Borders system, to improve estimates of how many people are leaving voluntarily. Beyond this, the government’s new policies amount to little more than a somewhat gimmicky, and arguably rather unpleasant, ‘shop-an-illegal’ helpline.

Perhaps most damning of all are the comments made in the conclusion:

‘The government has itself pointed to the fact that the ‘cap’ or quota on skilled migrants from outside the EU, which came into force in April 2011, cannot have restricted employers, since the quota is far from being fully taken up. It is slightly odd to see a government making a virtue of their flagship policy not actually having had any effect, but the more serious conclusion is that the experience of the cap so far should not be seen as a vindication of the policy for the future. The main reason the quota hasn’t been taken up is the state of the economy: employers just haven’t been hiring. As and when they start hiring in large numbers, the cap may indeed act as a drag on growth. It is vital to get this policy right – balancing the need to reassure the public that immigration is under control with the flexibility that employers need – before we get to that point, in 2013 if not in 2012.