This week's immigration and employment date are important, and contain important lessons for policymakers; they just aren’t the lessons which the papers suggest - and they aren’t just for the Home Office.
Update 2:15, Monday 16th August
Sarah’s full report -Immigration and Employment: Anatomy of a media story – iis now available to download from the ippr website – http://www.ippr.org/publicationsandreports/publication.asp?id=769
This week’s employment statistics provided an immigration bonanza for the right wing press: the Express (front page) went for “Foreigners get 77% of new jobs in Britain as too many of us live on benefits”; the Mail (page 2) went with “Foreign workers surge by 114,000… but the number of Britons with jobs falls”; and the Telegraph offered us “Record four out of five jobs going to foreigners between May and June” (sic – the data referred to are for April-June).
The Mail and the Express also reported a new study by Migration Watch which purports to show that immigration has led to reduced employment in the UK – but what do the stats actually show?
New ONS employment statistics show that 28,933,000 people in the UK were in work between April and June this year.
This is an increase of 188,000 (0.7%) on the previous quarter (though note that these statistics aren’t seasonally adjusted) and an increase of 101,000 (0.4%) on April-June 2009 (a comparison which should deal with seasonal variation). So far, so good – a positive sign of a recovering economy.
The breakdown by country of birth shows that 25,080,000 UK-born people were in employment in April-June. This is an increase of 41,000 (0.2%) on the previous quarter (again, not seasonally adjusted), but a decrease of 15,000 (-0.1%) compared to April-June 2009. In the same period, 3,846,000 non-UK born people were in employment – an increase of 145,000 (3.9%) on the previous quarter, and an increase of 114,000 (3.1%) on April-June 2009. Now you can see why people might be worried.
So, the Express’s ‘77%’ and the Telegraph’s ‘four out of five’ is taken from the quarter-on-quarter comparison (145,000 is 77% of 188,000). But these statistics aren’t seasonally adjusted, which means that year-on-year comparisons are more useful.
They are also more worrying for Express/Mail/Telegraph readers because they show an actual decline in the employment of UK-born people (expressed in the same terms as the Express/Telegraph headlines, the year-on-year figures show that 113% of new jobs went to non-UK born workers) – something that was no doubt not lost on the Mail when they chose to focus on the year-on-year figures.
So the papers are reporting real stats. However, there are two other sets of stats worth looking at – employment by nationality (rather than country of birth), and employment rates (rather than absolute numbers in employment).
Statistics broken down by country of birth disguise the fact that many non-UK born people are actually British nationals (e.g. the children of British servicemen born overseas, long-settled migrants who now hold British citizenship). Helpfully, the ONS also provide employment statistics broken down by nationality, though these don’t merit a mention in the papers (with the exception of a passing reference in the Express).
The same stats broken down by nationality show that 26,530,000 UK nationals and 2,401,00 non-UK nationals were in employment in the UK in April-June, i.e. almost 1.5m of the 3.8m non-UK born workers are actually UK nationals (as an aside, the Telegraph wrongly uses ‘British’ and ‘foreigners’ to describe country-of-birth data). This represented an increase of 4,000 (0.0%) in UK-national employment on April-June 2009, and an increase of 97,000 (4.2%) in non-UK national employment on April-June 2009.
So, employment data broken down by nationality confirms that there has been no decline in the employment levels of British nationals over the last year – the Mail are incorrect to say that ‘the number of Britons with jobs falls’. However, the overall trend pointed out by the papers stands – the vast majority of the increase in the number of people in employment over the last year is accounted for by an increase in the number of non-UK nationals in employment.
But this doesn’t necessarily tell us much about employment rates (i.e. the proportion of the population in work). It could be that the population of UK nationals is falling or steady, while the population of non-UK nationals is increasing (the UK has experienced net immigration in this period). This could mean that changes in the absolute numbers of each group in employment just reflect population, rather than telling us anything about employment rates.
In fact though, the stats on employment rates confirm the story – the 70.9% employment rate for UK nationals in April-June is 0.4 percentage points lower than in April-June 2009 (though note that the sampling variation is +/- 0.4%), while the 66.9% employment rate for non-UK nationals is 0.6 percentage points higher than in April-June 2009 (though note that the sampling variation is +/- 0.4%). In other words, non-UK nationals seem to have fared (very slightly) better in this period, in employment terms, than have UK nationals.
The final point about the statistics is about timeframes. Comparing employment rates between UK nationals and non-UK nationals between April-June 2009 and April-June 2010 shows rising non-UK national employment rates and falling UK national employment rates, but this hasn’t been true across the whole period of the recession.
The graph above (taken directly from yesterday’s ONS report) shows that in the last two quarters non-UK nationals have fared worse than UK nationals in terms of declining employment levels. Migrants have experienced a different recession to UK nationals, but not necessarily a ‘better’.
The papers (and some of the people they are quoting) seem to be using the employment data to make four points:
1. The vast majority of ‘new’ jobs are going to foreigners, not to British people;
2. Immigration has reduced employment and increased unemployment for British people;
3. The difference between UK nationals and migrants is that Brits would rather live on benefits than work;
4. The government must reduce immigration in order to get British people back to work.
What the statistics really tell us, however, is this:
• The number of jobs in the UK rose (very slightly) between the second quarter of 2009 and the second quarter of 2010;
• The employment rate of non-UK nationals rose slightly between the second quarter of 2009 and the second quarter of 2010 (by 0.6 percentage points); and
• At the same time, the employment rate of UK nationals fell slightly (by 0.4 percentage points), although the absolute number of UK nationals in work rose very slightly.
Not quite headline fodder, but true.
The evidence on migration and employment in the UK is ably summed up in a paper by my colleagues Maria Latorre and Howard Reed:
“In short, the best available UK microeconomic evidence on the effects of migration on employment finds either no effect at all, or very small negative effects.”
This conclusion is also supported by a wide range of research in other OECD countries.
The data on migration and employment in the UK certainly raise questions about welfare policies, but they also suggest that the problem of worklessness in the UK is complex, and unlikely to be solved by welfare reform alone.
The most convincing link between migration and employment is a political one, and for the Government to reduce immigration in order to give itself an incentive to deal with unemployment seems like backward logic. Similarly, reducing immigration to give employers an incentive to invest in training seems like a roundabout way to address the problem.
These data on immigration and employment are important, and contain important lessons for policymakers; they just aren’t the lessons which the papers suggest – and they aren’t just for the Home Office.
Sarah’s full report -Immigration and Employment: Anatomy of a media story – in which she explores each of the papers’ four points in detail, can be downloaded from the ippr website here.
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