ONS reveals impact of immigration on low-paid jobs and wages; how should Labour react?

New figures show the importance of Labour winning the argument about the impact of immigration on lower-paid jobs and wages, writes ippr's Matt Cavanagh.

By Matt Cavanagh, Associate Director, ippr

Today for the first time the ONS published figures confirming that immigration has had a significant effect at the lower end of the labour market over the last decade.

Just over 20% of workers in low-skill occupations were born outside the UK. This is more than double the proportion in 2002 – and a much steeper rise than at higher skill levels, as this ONS graph shows:


The overall number of low-skill jobs is broadly unchanged at around 3.2 million – but the number of UK-born workers in these jobs has fallen from 3.56m to 3.04m, while the number of non-UK-born workers has risen from 298,000 to 666,000.

How to deal with the impact of immigration at the lower end of the labour market is top of the agenda for both the Conservatives and Labour.

David Cameron set out his solution in a high-profile speech in April: he argued that if we reduce the supply of immigration, while at the same time making it harder to live on benefits, this will shift large numbers of people from welfare to work.

Ed Miliband’s argument was different: that if wages and conditions improve, the result will be simultaneously to reduce the demand for low-paid migrants, and to shift people from welfare to work – but by making work more attractive, rather than making living on benefits harder.

It is a healthy development that the Conservatives as well as Labour now accept that low skill immigration is a symptom of our real problems (welfare for the Tories, wage stagnation for Labour) rather than the cause. But the problem for Cameron’s argument is that he can’t really restrict the supply of low-skill immigration. Today’s figures confirm that most of the increase in non-UK-born workers in low-skill jobs over the last decade are Eastern Europeans.

Other figures out today confirm that immigration from Eastern Europe is rising again – 50,000 up from last year. Labour should seize the opportunity to flesh out its alternative argument, aimed at the demand for immigration not the supply – showing it is more realistic, as well as fairer, especially for the 3 million British nationals already in low-paid work.

18 Responses to “ONS reveals impact of immigration on low-paid jobs and wages; how should Labour react?”

  1. Eugenie Teasley

    Stats show impact of immigration on low-paid jobs and wages; how should Labour react? http://bit.ly/kT3Hh6 by @ippr's @matt_cav_

  2. Rene Cuperus

    Stats show impact of immigration on low-paid jobs and wages; how should Labour react? http://bit.ly/kT3Hh6 by @ippr's @matt_cav_

  3. Free Movement

    RT @leftfootfwd Stats show impact of immigration on low-paid jobs and wages; how should Labour react? http://bit.ly/kT3Hh6 by @ippr

  4. Matt Cavanagh

    My blog on new ONS stats on impact of #immigration on low-skill jobs – and how this changes the Labour v Tory debate: http://goo.gl/W7r5j

  5. Rick Muir

    My blog on new ONS stats on impact of #immigration on low-skill jobs – and how this changes the Labour v Tory debate: http://goo.gl/W7r5j

  6. Julian

    “Ed Miliband’s argument was different: that if wages and conditions improve, the result will be simultaneously to reduce the demand for low-paid migrants, and to shift people from welfare to work”

    You seem to be saying that an immigrant will take a job if the wage is low but will not get it if the wage improves. Doesn’t seem likely, especially as immigrant labour seems to be preferred on many grounds apart from cost.

  7. Andy

    Surely the issue here is about human capital, and the failure of our education and vocational training system to adequately prepare lower skilled workers for the labour market, with the result that employers would rather hire migrants?

  8. Anon E Mouse

    Every day on this fine blog I feel I am being proved right time and again.

    If you flood the country with mass uncontrolled immigration don’t be surprised when there is a backlash…

  9. Richard Hicklin

    Political correctness closed down sensible immigration debate when the country was shouting about it: damaging low paid http://bit.ly/kT3Hh6

  10. BenM

    3. AnonEmouse

    Backlash from where…?

  11. Jamie Jenkins

    You can view a short (5.04) video on this story on the ONS YouTube channel showing animated graphs.

    http://youtu.be/7ceFFPV2cEk

  12. Matt Cavanagh

    Julian – “You seem to be saying that an immigrant will take a job if the wage is low but will not get it if the wage improves.” Here’s what I’m saying. (1) There has been wage stagnation at the lower end of the labour market – a trend identified by the Resolution Foundation and others going back to the early part of the last decade. (2) This has been one of the factors driving the demand for immigration. (3) If and to the extent that only migrants are (on any large scale) willing to do some low-paid jobs, then to that extent, if wages for those jobs rise, that will reduce the demand for immigration.

    How much it will reduce it, will depend on other factors, including some of those you and Andy cite. But it won’t be irrelevant. And unlike the alternative Conservative idea of restricting the supply of immigration, it could reduce EU as well as non-EU immigration – which is important, because as today’s figures show, a lot of the recent increase in low-skill immigration has been from within the EU.

  13. greg

    @ Andy
    Certainly is an issue, the more I looked into things like apprenticeships and vocational qualifications as part of my work over the past year the more I saw that many of them arent any good, there is no basic standard. Some apprenticeship frameworks are brilliant while some are utter rubbish depite both being ‘an apprenticeship’. Then teaching is very patchy. Getting one far harder than it should be and there arent nearly enough etc etc

    However I do not think skill levels of workers in low income jobs is the issue as to why an employer would choose an eastern European national over a British national. It is simply down to attitude and productivity, on the whole they are much better employees than their british counterparts applying for the same job.
    It is a generalization but it is one that is somewhat correct and more importantly one accepted by many employers.

    I think half the problem with apprenticeships is that not enough employers offer them, part of this is cost but the really big factor is risk because of their attitude and unreliability of the people that are the target employees for apprenticeships.
    I really really hate to sound like some doddering old bigoted tory but work ethic, attitudes towards life and work as well as negative societal influences so on really do have to be addressed on a national level.
    There certainly needs to be the jobs there as well dont get me wrong on that as without the jobs you can do nothing.

    But Having worked almost at the coal-face on a project to help young (under 25) and low-skilled unemployed people through my employers I think work ethic is one of the big issues and we should be asking why this is and what can we do about it. until we do i think there will be a large problem of employers simply favoring eastern european workers in these areas.

  14. Anon E Mouse

    BenM – A backlash from the plumbers and sparks and chippies who are (or should be) Labour’s natural demographic.

    Remember Brown lying about “British Jobs For British Workers” – well now the plumber from Poland does the £25 / hour job for minimum wage and the backlash is from traditional Labour voters who no longer vote for them. This resulted in Labour’s second worst election defeat in history last year, the Scot Nat’s winning outright in Scotland (despite the gerrymandering from Labour) and the party being unable to win outright in Wales.

    The polls show Labour are going nowhere fast (it’s understandable with Milliband in charge) and the backlash is from the parties normal voters who no longer support them.

    Bring back Tony Blair – he knew how to win elections…

  15. Dave Citizen

    Tricky one this. Large scale economic immigration clearly puts downward pressure on wages and upward pressure on the price of rents, food prices etc. No surprise that business investors as well as land & property owners tend to like it. Economic migrants are also likely to reduce the tendency for rent and other price rises to feed into wage rise demands – they tend to have more options to reduce living costs, e.g. sharing in multiple occupation, working longer ‘unsociable hours’, etc. And work ethic as mentioned above.

    Not so clear what benefits all this has for ordinary workers, particularly those whose communities will accommodate significant migrant communities. Not the fault of the migrants of course, but they tend to be the scape goat while the fat cats reap the rewards.

  16. Khadija Rahman

    RT @leftfootfwd Stats show impact of immigration on low-paid jobs and wages; how should Labour react? http://bit.ly/kT3Hh6 by @ippr

  17. Anon E Mouse

    Dave Citizen – And those ordinary workers are Labour voters…

  18. Matt Cavanagh

    @frasernels @dsmitheconomics Stimulating piece. As you say, Tories wrong to say answer is restrict supply. See my piece: http://t.co/jrRqbYi

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