Immigrants necessary for Britain’s recovery from recession

Migrants needed to resolve long-term problems of skills shortages and an ageing society, reports suggest

9th July 2009: With the International Monetary Fund (IMF) predicting that Britain’s recession will end this year, the focus is again on the need to have the immigrants around, as their contribution to the economy cannot be overlooked.

Britain’s recovery from the recession is likely to be hit by a fall in the number of immigrant workers. In fact, a group of economic forecasters hold that the reduction in their numbers threatens to create skills shortages and hold back the recovery.

Reports suggest the impact of shortage of qualified staff will reflect itself not only on gross domestic product growth, but also threaten to obstruct efforts to rebalance the economy, with more manufacturing and less financial and other services.

In fact, the Ernst & Young Item Club, with companies from a range of industry sectors as members, only recently asserted the economy’s dependence on imported labour was underlined by Financial Times’ research showing foreign-born workers were proving more successful at holding on to jobs in the recession than their British-born counterparts.

By now it also is apparent the migrants are needed to help resolve the long-term problems of skills shortages and an ageing society.

Keeping this in mind, the Organisation for Economic Co-operation and Development (OECD) has already urged the government not to use the economic downturn as a ground for closing the door to foreign workers.

The UK Government has also been advised to maintain a flexible system that allows migrant workers to come into the country in order to meet the needs of British industry.

Mr. Tim Finch, Head of Migration at the Institute for Public Policy Research (IPPR), recently said: “It’s important the system remains flexible enough to meet the needs of British industry through the downturn as well as when the upturn comes.

“If there are British born people with the skills to fill the jobs that need doing – that is good news. But in their absence, migrant workers can fill the gaps and, in the process, help our economy.”

Mr. Finch also rejected calls for an annual limit on immigration, saying the Government was right in resisting such calls from the Conservatives and others. “Such a quota would be artificial, very difficult to enforce and economically damaging.”

According to Mr. Finch, migrants have made an important contribution to rural economies by filling skills gaps and labour shortages.

He says IPPR’s research shows the crucial role that migrant workers have played in rural economies in recent years, and highlights the risks that will be faced by rural economies if migration declines in the future.

Mr. Finch believes in recent years the number of migrants living or working in the British countryside has increased rapidly, particularly since the accession of new countries to the EU in 2004 and 2007.

Migrants have made significant economic contributions: filling vacancies and skills gaps, and promoting job creation and productivity. Also, migrants have been particularly important in supporting some key sectors including agriculture, food processing, and hospitality.

Graham Russell, Executive Director at the Commission for Rural Communities, agrees: “Migration is often thought of as an issue for cities, but this research shows that migrants play an important role in rural economies too.

“The economic needs and prospects of rural communities must be taken into account in the Government’s migration policies and economic development planning undertaken by Regional Development Agencies and Local Authorities.”

By Monika

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