Morning Line: EU immigration slows as UK economy hits the skids
By Tony Bonsignore
CITY WIRE
10:30:00 | 22 August 2008
Experience has taught me that there are two subjects best avoided in polite conversation with strangers: immigration and religion. But what the heck, its important stuff, its the quiet Friday before the bank holiday weekend, and it makes a welcome change from bank-bashing.
First then, immigration, and news today that the extraordinary four-year long surge of migrant workers coming into the UK from the new eastern states of the European Union appears finally to be easing off.
According to official figures, more than 850,000 eastern and central Europeans have registered to work in the UK since 2004, with around two thirds coming from Poland. Most of the remainder hail from the other A8 accession countries that also joined the EU in 2004 Czech Republic, Estonia, Hungary, Latvia, Lithuania, Slovakia and Slovenia as well as from last years new joiners, Bulgaria and Romania.
These people were primarily attracted to the UK by abundant job opportunities, relatively high wages, and a strong currency. The UK, meanwhile, benefited from a plentiful yet relatively inexpensive supply of quality labour exactly at the time when it needed it most, when the debt-fuelled economy was growing at breakneck speed.
At the same time the swelling population boosted the demand for key goods and services, extending and strengthening the decade-long consumer boom. The housing industry, for instance, was one major beneficiary of this trend.
Now, however, it seems the UK is losing its appeal. According to new Home Office figures, the numbers of A8 migrants registering to work in the UK dropped by 27% year-on-year in the second quarter of 2008 the biggest one year fall since the current surge began in 2004. Anecdotally, too, one sees plenty of evidence of recent arrivals packing up and heading homeward.
The reasons, one would think, are pretty self-evident. A rapidly slowing economy and falling living standards, for one, as well as a currency that is finally and belatedly crashing back to earth. At the same many migrants are seeing greater opportunities open up in their home countries; Poland, for instance, has enjoyed something of an economic boom over the past few years, with wages and employment rising, especially in the big urban centres. The Polish currency, meanwhile, has appreciated from over seven zlotys to the pound five years ago to around four to the pound today.
The unanswered question now is what effect this slowdown will have on the UK economy. Much, of course, depends on events over the next few months and years, and whether we experience a brief but manageable slowdown, a sharp recession, or even a depression. That, of course, will to a certain extent determine the economys demand for labour. At the same time, though, it could be argued that the skills imported into the UK with migrant workers may be one of our best hopes of riding out the global slowdown and re-emerging stronger than ever.
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Comments (1)
B B
13:20 | 22 Aug 2008
Is there `more to life than making money`
well most certainly there is. The government and big business perpetually tell us how good immigration is for the economy. That may well be but is it good for the population and would we have a better quality of life without it or at least without it to the extent that we`ve incurred in recent years. Britain and most particularly urban Britain has become almost a foreign land.
Lets have a referendom of the indigenous peoples of these islands and see what the consensous is. Wishful thinking, i know.
