How British jobs for British workers can happen after Brexit

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at 2016.11.01
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How British jobs for British workers can happen after Brexit

This op-ed is part of the FT’s Future of Britain Project. We are inviting readers, commentators and thought leaders to brainstorm ideas for the future of Britain after Brexit. This piece is in response to the third topic: how should the UK deal with immigration? Submit your own idea here.

Since the UK voted in June to leave the EU, immigration policy has become a battleground of competing ideologies. Frustrated Remainers tend to argue that free movement of labour is essential to retain membership of the EU’s single market. The contribution EU workers make to Britain’s economy, exchequer and society is too often a secondary discussion.

On the other side, all considerations come after the government’s arbitrary target of reducing net migration to the “tens of thousands” — which can be achieved only if it clamps down on all routes into the UK, compromising humanitarian obligations and the needs of the economy. An increasingly unpleasant strain of xenophobia colours the debate, exacerbated by ministers’ failure to guarantee the rights of EU nationals already working in Britain, which has led many to conclude that they are no longer welcome.

Perhaps it is time to step back and reframe the question. The aim of Britain’s migration policy should be to ensure that it can attract international talent and help employers recruit the staff they need, provided there is no detriment to UK workers. A work permit system, while incompatible with single market membership, could in theory be a reasonable way to achieve this.

However, the current system for admitting skilled workers from outside the EU is restrictive and cumbersome. It imposes a tight cap on the number of visas available. Employers must register to sponsor visas — but the fee and red tape deter small businesses. For most jobs, employers must prove they have tried to find a suitable UK candidate (a “resident labour market test”), although this test is waived for jobs on a list of shortage occupations.

In addition, there are minimum salary thresholds, hefty application fees and, from next April, a levy on employers of £1,000 per person per year — an incentive, as if there were none already, to invest in training British staff instead of hiring migrants. All this is for jobs at graduate level or above, where the economic benefits of migration are clearest and the need to protect UK workers less obvious.

Far more contentious is low-skilled migration, where the only precedent in UK policy is the short-term sectoral scheme that used to operate for fruit-picking and food processing. It is not clear this model would work in the many areas of the economy — from construction to care homes — that currently rely on EU migrants. If, as seems likely, the government institutes a work permit system for recruitment from the EU, it should take a more flexible approach.

There should be no attempt to limit work-related migration to a list of shortage occupations or to highly skilled roles. This is a recipe for endless lobbying but is inevitably a subjective judgment. There will never be enough British workers willing to pick strawberries, but do we need British strawberries? The NHS struggles to recruit nurses, but surely this would change if it offered better pay and progression?

It would be better to introduce a mechanism that made it more costly — but not punitively so — for an employer to hire abroad. This could include the resident labour market test, but too often this process forces employers to jump through administrative hoops rather than mirroring a genuine job search.

A more effective approach, the independent Migration Advisory Committee argued last year in advice to the Home Office, is simply to set a higher salary threshold and impose an upfront levy at a flat rate. This serves to skew the system towards high-skilled migration, because the levy generally represents a higher proportion of the salary of a low-skilled worker. It would also raise significant revenues — helping the government to find the resources needed to train British workers and alleviate pressures on public services.

While any work permit system would rule out continued membership of the single market, it would at least give the UK some leverage in negotiations, especially with member states for which low-skilled migration matters. It would also almost certainly result in net migration well above the government’s target. But although ministers equate lower migration with “the interests of the British people”, there is no intrinsic virtue in cutting numbers.

Their rhetoric is, however, doing real damage to the UK’s reputation as a tolerant, open society. There is an urgent need to revisit plans for entirely counterproductive restrictions on international students, to make a commitment to helping child refugees and to combat a worrying rise in hate crime.

Some have attributed a recent fall in asylum applications to the Brexit vote. If even refugees are starting to doubt Britain’s attractions, it is hardly a cause for celebration. If the government pursues a “hard Brexit” at the expense of the economy, the UK may soon hold little attraction for European workers, either.

delphine.strauss@ft.com

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Published at Tue, 01 Nov 2016 05:00:58 +0000

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