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When it comes to the discussion about immigration, both its advocates and its opponents tend to display a certain contempt for the working class. Last week Cameron lamented the consequences of high immigration, and blamed the phenomenon on the British welfare system. British workers, he argued had become addicted to welfare, in turn forcing British firms to look abroad. It is unfortunate that, in making this case, he was echoing some of the arguments that get made by what we consider to be the liberal left. As I have noted in the past, the Guardian and the Independent have sometimes made the case for immigration but telling us how “useless” or “revolting” low skilled British workers are.
Indeed, as distasteful as Cameron’s remarks were, the case being made for immigration by Cable and the business lobby is not that much more appealing. Cable’s approach is that immigration is necessary to fill gaps in the labour market. This line of argument is frequently echoed by business. Robert Peston recently alerted us to the complaints of leading British industrialists who argued that the pool of talent in Britain alone is not wide or deep enough.
It is indeed rather galling to hear that migrants are desperately needed to fill gaps in the labour market, while 2.5 million of our citizens are without work. Of course there can be a mismatch between the skills that people have, and the skills that businesses require, and of course, as Chris Dillow recently argued, labour is not completely mobile: “An unemployed council workerin Swansea”, he writes, ” cannot easily become a plumber in London or fruit-picker in Lincolnshire.” Yet the discussion ought not to end there. First of all, people’s abilities are not completely immutable. People can be trained and retrained, and the businesses that have benefitted the most from the upturning and remoulding of the British economy over the preceding decades to be prepared to shoulder some of the costs. Secondly, it is not completely crazy to suggest that Britain should seek to direct its economic activity towards the kind of skills that people have.
This modern globalised economy in which we live is characterised by uncertainty and constant change. Patterns of comparative advantage can rapidly shift, and developments elsewhere can – if things are left to the market – very suddenly make whole sectors of the economy inviable. This is what we saw in the 80s. For business, mass migration can be a means of transferring these risks onto the working class. Workers whose skills are now the “wrong” skills can simply be dispensed with. There is no incentive to retrain and reskill, when those with the “right” skills can simply be cherry picked from across the globe. Equally, the kind of activity in which businesses engage can be determined only by what can be sold most profitably, without reference to what the existing labour force is best able to produce. The scrap heap piles up, and piles up some more.
If this looks like a call to limit migration, it is not. But what I am saying is that a defence of migration cannot simply be a defence of the status quo. We need to push for the kind of society and the kind of economy in which migration genuinely works to the benefit of all concerned. Because right now, the picture is not as rosy as some on the liberal left seem to complacently believe. In response to Cameron’s speech, Mehdi Hassan – senior political editor at the New Statesman – made a spirited defence of immigrtation. In doing so, he boasted of a Low Pay Commission report which, he said, found that immigration increased the average waes of non-immigrant workers.
The report itself did indeed discover that immigration was increasing the “average” wage. Yet it also found that while immigration was associated with “significantly positive wage effects around the middle of the distribution”, it also had “clearly negative wage effects at the lower end of the distribution”. In other words it was associated with increasing inequality. There is no necessary reason why immigration should have such an impact. As with any other phenomenon, the impact of migration is dependent upon the social and economic circumstances in which it takes place. With, for example, stronger unions and better labour laws (ours anti-union legislation is amongst the most restrictive in the developed world), wages for the worst off need not simply a matter of supply and demand. But unless we are prepared to put forward such an alternative, then we might as well hold our peace.
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