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Migrants in the UK labour market

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On 15 July 2019, the Migration Observatory published a research briefing providing data on migrants labour market integration and the jobs they do in the UK labour market. It also presented data on migrants' employment and unemployment rates, occupational status, earnings and contract types.

Based at the Centre on Migration, Policy and Society (COMPAS) at the University of Oxford, the Migration Observatory provides evidence-based analysis of data on migration and migrants in the UK, to inform media, public and policy debates. The director of the Migration Observatory, Madelaine Sumption, is also a member of the Migration Advisory Committee (“MAC”), an independent panel that advises the UK Government on migration issues.

The briefing note follows on from the MAC’s extended research into the impact of Brexit on the domestic labour market, which in turn informed the governments’ White Paper on the future skills-based immigration system which it is proposing to commence from 1st January 2021. Whilst much of the MAC’s study relied on the 2017 Labour Force Survey ("LFS"), the below findings are taken from the now available 2018 LFS.

2018 LFS findings:

  1. Male migrants are more likely to be employed than UK citizens (83% to 79%), whilst female migrants are less likely to be employed than UK citizens (66% to 72%). 
  2. Unemployment rates for both migrants and UK citizens fell steadily from 2012 to 2018 and are historically following the same trend lines in parallel.
  3. EU born workers have had a lower unemployment rate from UK born workers since 2008. Non-EU migrants have always had higher unemployment rates than UK citizens.
  4. Unemployed migrants are less likely to claim unemployment benefits (18%) than UK born unemployed workers (26%).
  5. 17% of the employed population is made up of foreign born workers, with 83% being UK born.
  6. A third of workers born in "new" EU member states (i.e. those who have joined the EU since the 2004 enlargement) were in retail and manufacturing jobs in 2018.
  7. Workers born in India, East and Southeast Asia and in EU-14 countries are more likely to be in highly skilled occupations than UK born workers.
  8. EU nationals form significant proportions of unskilled professions. 21% of the UK construction and factory workforce were born in the EU.
  9. Foreign-born workers were more likely to work during night shifts and in temporary jobs than UK born workers. About a quarter of EU-born workers have jobs involving some kind of shift work, compared to 17% of UK born workers and 21% of non-EU born workers.

Our view:

From 1 January 2021, the UK is likely to see the end of free movement of people from the EU to the UK and the commencement of a new unified immigration system for both EU-born and non-EU born migrants. Proposals for the new working visa route include minimum salary and minimum skill level requirements. Non-EU born migrants have long been subject to such conditions, hence non-EU migrants having higher employment rates, being in higher-skilled occupations and being less likely to require unemployment benefits and medical care.

The parallel between unemployment levels of both UK-born and foreign-born workers does not prove a causative relationship between the rising of economic immigration into the UK and a rise in unemployment for UK-born workers. As immigration has risen, so too has the employment rate of UK-born workers, which whilst having only a mostly correlative relationship does not suggest that immigration reduces employment rates for UK-born workers.

The impact of Brexit is most likely to be felt in occupations that will not qualify for visas on account of either skill level or salary level. Large proportions of workers, particularly from countries that have joined the EU since 2004, will fail to find employment if the job roles do not qualify for visas. Sectors such as construction, factory work and retail look to be particularly at risk of being unable to fill roles that have been traditionally undertaken by EU workers who have statistically taken more roles that are based on shift-working than UK workers.

If you feel that the proposed immigration rules might have an impact on your business, contact us to discuss how you can assess which roles might be at risk.

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