For those seeking jobs outside of their home countries, new British Prime Minister Liz Truss’ decision to ease immigration policy into the UK to boost the economy may come as welcome news. However, we should think twice before hopping onto Truss’ offer. I argue that although the prospect of increased job vacancies is enticing given the current global financial crisis we are facing, the reality of these occupations may not live up to our expectations.
The UK’s financial problem
Liz Truss’ plans to loosen immigration rules into the UK come amidst a time of national recession. The British economy experienced a 0.1% drop in gross domestic product (GDP) from March-June this year, and analysts expect a further 0.1% decline in the third quarter of 2022. The slump in growth has come about because of rapidly inflating energy prices caused by Russia cutting off large amounts of gas supply to Europe, which means that households across the nation are holding back on making other purchases.
As we can see, however, the UK is currently experiencing both recession and inflation simultaneously, which is a troubling economic phenomenon called stagflation. Such an issue is tough to solve because the standard policies used to bring an economy out of recession, such as reducing interest rates to stimulate spending, will push prices up while discouraging spending from deflating prices could potentially lead to decreased GDP.
We can see how this thorny problem has been reflected in the decisions of the country’s economic leaders. A majority - note, not all - of the Bank of England’s nine-member monetary policy committee (MPC) HYPERLINK "https://www.theguardian.com/business/2022/sep/22/bank-of-england-interest-rate-rise-latest" voted to raise the base interest rate to 2.25%, its highest level since the 2008 recession. Moreover, they came to the judgment that the dangers of inflationary pressures in the long term outweighed the short-term financial problems at the moment - essentially choosing to prioritize tackling inflation over the recession.
In addition to raising the base rate, the UK’s new financial minister Kwasi Kwarteng announced the implementation of an energy price guarantee, which would help to cap soaring prices and bring down inflation in the short term. However, combined with Kwarteng’s additional plan to cut taxes, his policies may conflict with the Bank’s in the foreseeable future. The Bank warned, “While the guarantee reduces inflation in the near term, it also means that household spending is likely to be less weak… this would add to inflationary pressures in the medium term.”
How will immigration policy fit into Liz Truss’ battle plan?
So far, it seems that the Bank’s priorities in this financial crisis are not perfectly aligning with the Conservative government over in 10 Downing Street. And it is not only Kwasi Kwarteng - Truss’ immigration plans are set to stimulate economic growth to bring the economy out of recession.
By allowing more workers to enter the country, even if on a short-term basis, many businesses, particularly in the hospitality sector, will be able to fill the labor shortages that they have been complaining about to the country’s leadership. Hospitality businesses have been “frustrated that the visa system for skilled workers has not been responsive enough to alleviate the shortages they have experienced.” But if productivity goes back up due to the reparation of these shortages by migrants, these businesses may be able to generate more revenue, which could lead to increased economic growth.
Therefore, according to The Sun, the cap on immigration is expected to be lifted, and the six-month time limit for seasonal work visas will most likely be extended. Furthermore, the government’s shortage occupation list will be expanded so businesses can more easily fill vacancies by recruiting overseas workers.
Picture perfect… not for the migrants
Young people looking for jobs may, in a world that is otherwise unfavorable towards employment of the inexperienced, jump at the chance to enter the British workforce. However, we must remember who we are dealing with here: the UK’s infamous Tory party.
The Tories’ conservative attitude towards the country's leadership has meant that their immigration policy has traditionally been strict. In 2012, the UK closed the “post-study work” route for international students hoping to find work after graduation, such that the only way for internationals to gain occupation in the UK was for them to gain a skilled work visa sponsored by their employer. This led to a massive drop in the number of non-EU international graduates working in the UK, from nearly 50,000 in 2012 to just 6,438 in 2020.
Furthermore, the Tories also cap the number of unskilled migrant workers. The seasonal workers’ program, which was introduced in 2019, allowed up to 30,000 migrant workers to fill seasonal roles in the horticulture and poultry sectors in 2021. However, they only gave 29,600 visa grants that year, and research has shown that these workers are vulnerable to exploitative measures from their employers.
The Tories have exercised an unfriendly attitude towards immigration since the early 2010s. And though Liz Truss’ easing of policy seems to show a change of attitude, her proposed policies may only serve to isolate immigrants from local British society further. This is because the suggested changes have only been made to unskilled occupations, while there seems to be little to no change in the policy towards skilled workers. As such, university graduates seeking high-paying jobs will continue to find the job-seeking process full of challenges and obstacles.
At the same time, those who want to leave their home countries for whatever reason will readily take up the low-wage jobs offered to them in the UK. In Hong Kong, where I live, an infamous story is trending online in which a man who was a pilot in Hong Kong could only find a job as a truck driver in England. Furthermore, I am sure such stories will only increase in the future, with Truss’ bottom-heavy policies that ignore the skills and capabilities of those eager to find better opportunities.
Furthermore, a source from 10 Downing Street told The Sun, “We need to put measures in place so that we have the right skills that the economy, including the rural economy, needs to stimulate growth… As the prime minister has clarified, we also want to see economically inactive people get back into work.” This comment shows us how the current leadership is happy to let migrant workers bear the brunt of the UK’s national recovery. Despite the alleged relaxation of immigration measures, it seems as if the acceptance of migrant workers will continue to be a cherry-picking process in which only those with the “right skills” will be allowed in. As such, less skilled migrant workers will find it harder to enter the UK, while highly skilled workers will be forced to accept jobs under their skill level to remain in the country.
And, of course, this comment makes no direct mention of the migrant workers that Truss is hoping will form the foundation of the UK’s economic recovery. Indeed, the statement wipes out any trace of migrant involvement, perpetuating the invisibility and low status of immigrants in the UK. As The Migration Observatory points out, “little is known about how to work visa holders fare in the long term, particularly after they have received settlement or citizenship (for those who remain in the UK).” There is very little interest in the welfare of those workers who sacrifice a lot to work in the UK and boost its economy, despite the apparent wealth of opportunities available.
Overall, Liz Truss’ decision to ease immigration policies into the UK sounds appealing at first and may even look like a break from Tory tradition, but in reality her plans have been constructed to direct immigrants further down the hierarchical rung of elite British society. Immigrants are only welcomed into places like the UK at times of financial need, in which case foreign sources of labor become attractive in their readiness to come at low prices. For Liz Truss to truly implement beneficial change in immigration policy, her administration must consider placing immigrants on an equal platform with the rest of the population - but this may be something the financially troubled country is not ready to do yet.
Image source: Wally Gobetz via Flickr
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