Firms need skilled workers—and the prime minister needs to stop making panicky promises
BRITAIN’S economy is back on track, growing faster last year than any other in the G7 group of rich countries. So British firms are expanding—and hiring. But for David Cameron, the welcome boomlet presents an inconvenience. Five years ago, when the economy was in the doldrums, the prime minister made a foolish vow drastically to reduce immigration. The promise always looked unrealistic. Now, as the economy fires up and firms recruit, it threatens to become crippling.
Britain’s companies need the right workers if they are to grow. Yet tight restrictions on skilled migrants from outside Europe mean that firms are already being told that they cannot hire the people they need. The problem is easy enough to fix: the inflexible annual quota should be raised or, better, scrapped altogether. But there is no sign of that—indeed, egged on by right-wingers in his Conservative Party, the prime minister has said he wants to tighten the tap.
Repent at leisure
When Mr Cameron announced in 2010 that he would bring annual net migration down to “tens of thousands”, Britain was hardly an appealing destination for migrants. The economy had shrunk by 4.3% the previous year and immigration had been falling. When in 2011 he put a cap on skilled non-European migrants, limiting their number to 20,700 a year, it made little difference, since so few firms were recruiting. But last month, for the first time, the monthly allocation implied by this cap was reached. Companies around the country have had visa applications unexpectedly rejected. Most of the jobs that will now go unfilled are skilled, middle-earning ones: junior managers, trainee bankers, lawyers, nurses and teachers.
Despite howls from business, the rules are to stiffen. Multinationals will face more restrictions in moving their overseas employees to British offices; a new levy could be imposed on the already-expensive visas. “It has been too easy for businesses to recruit from overseas, undermining those who want to work hard and do the right thing,” said the prime minister (who hired an Australian to run his re-election campaign).
This is daft. The targets of the crackdown are the very last immigrants that Britain should be keeping out. They are specialists and bottleneck-busters, young and well paid: commercially and fiscally handy people to have around. Mr Cameron’s self-defeating cap will crimp economic growth and won’t even mollify critics of immigration. The 20,700 skilled non-Europeans represent barely 3% of Britain’s annual inflow of immigrants, so slashing their numbers will do little to reduce headline figures. Nor will it free jobs for Britons, since many would-be employers of highly skilled foreigners will simply move. Global firms would find it simple to shift graduate trainees out of London.
Damaging caps on migration, dubious fiscal rules, a referendum on membership of the EU: a worrying number of the threats facing Britain come from Mr Cameron’s jelly-willed eagerness to make promises about the future if it allows him to scuttle out of danger in the present. The Tories’ election-winning manifesto is stuffed full of such fantastical pledges, from all-hours doctors’ appointments to subsidised home-ownership. Scarcely a week passes without the Tory backbench gaining some new panicked concession on Europe (this week: the timing of the referendum). Migration is merely the latest of these political IOUs to fall due—and it is Britain that will pay.
June 23, 2015UK visa & immigration consultation