Free movement has worked well for the UK economy

Things are getting bleak when even non-partisan experts seem to be turning a blind eye to evidence.

Last week's comprehensive report on European Union migration from the government's independent Migration Advisory Committee (MAC) gave with one hand and took away with the other.

It did a splendid job of busting some entrenched myths about the economic impact of flows of EU migrants under freedom of movement.

No, EU migrants are not a drain on public services or the public finances. No, they do not discourage employers from offering training. No, they do not harm schools. They are not responsible for more crime.

There is a small negative impact of low-skilled EU migration on low-skilled UK wages but this is more than offset by other factors, not least the evidence that migrants seem to boost national productivity growth.

Such an authoritative overview would have been most welcome during the 2016 EU referendum campaign, when politicians sprayed the public with bogus claims about the adverse economic impact of free movement, often without media challenge.

As Jonathan Portes of King's College London wrote for The Independent: "It is hard to overstate the significance of these findings. Immigration, overall, has made the UK a more productive economy and a more prosperous country - and can do so in the future."

And yet the MAC's chair, Professor Alan Manning, also recommended last week that a post-Brexit immigration system should cut off opportunities for low-skilled workers (including from the EU) to come to the UK, while throwing open the door to the high-skilled from everywhere in the world. "Low-skilled", by the way, would effectively encompass those migrants who could only command a salary of below £ 30,000 a year, which is higher than the UK's median.

This is strange because there is nothing in the evidence assembled by the MAC which seems to support this radical change of immigration policy from an economic perspective. While it finds that high-skilled migration is more economically beneficial, there is nothing presented which suggests low-skilled migration is, in any substantive way, harmful. The opposite in fact.

And the heavy reliance of some sectors on EU workers speaks for itself of the likely disruption of cutting off the supply. EU migrants account for 30 per cent of employees in food manufacturing, 16 per cent in warehousing, and 14 per cent of construction workers.

The Institute for Public Policy Research think tank has estimated that, under the regime advocated by the MAC, virtually all of the EU employees currently working in hotels and restaurants would have been ineligible to come here.

Nevertheless, the MAC's policy advice seems to have strengthened the hands of the anti-EU free movement members of the government, including Theresa May. Reports suggest that cabinet ministers have concluded that this "high-skill yes, low-skill no" recommendation is roughly what they will target.

This isn't final. Assuming there is no collapse in the Brexit talks before next March, talks will then begin, during the transition, on a free trade deal. The EU is very likely to ask for some continuation of work rights for all EU citizens in return for the kind of comprehensive agreement that the UK is shooting for.

And reports also suggest the cabinet accepts the need for some kind of "specific route" for low-skill worker migration from the EU to continue for heavily migrant-reliant sectors such as agriculture, social care and hospitality. The MAC report had only mooted a carve-out for agriculture.

Yet there's something unsettling nonetheless about the general direction of travel set up by the MAC and the government.

Professor Manning seems oddly insouciant about the economic consequences of cutting off the supply of low-skilled labour to certain sectors, saying they are "not necessarily the parts of the UK economy that we want to be growing".

This would hold more weight if the MAC had directly analysed the likely economic costs of government interfering with the forces of supply and demand for low-skilled labour. But it didn't.

Jonathan Portes also points out that, despite the MAC report being impressively comprehensive in most dimensions, it did not commission work on how trade in goods and services and liberalised migration for work can be mutually supportive; an important subject in relation to EU free movement.

Yet one of the great virtues of science is that one need not draw the same conclusions from the data presented, or the evidence uncovered, as the particular scientist presenting it. One perfectly respectable conclusion from the empirical work marshalled by the MAC is that free EU movement is actually already working pretty well for the UK economy and that - Brexit or no Brexit - there is no case for scrapping it.

We may soon have cause to regret Britain’s repellent national conversation about European immigrants

To warn about the consequences of an exodus of European Union workers from the British economy probably comes across like shouting fire in the midst of Noah's flood. 

Aren't there more than two million EU nationals in the British workforce, double the number a decade ago? Isn't net immigration from the EU running at almost 200,000 a year according to the latest figures? Didn't millions of Britons vote for Brexit precisely to reduce the numbers of workers from the Continent coming to Britain?

Yet if we know that when the flood waters recede there will be an abundance of vulnerable dry kindling and a scorching sun, it's not alarmist to warn of the risk of a conflagration. And we do know that. The size of the UK-born workforce appears to have peaked in 2015 at around 26.5 million. Workforce participation rates are at a record high. This implies that any net increase in demand for employees from firms, over the coming decade at least, will probably have to be met by new migrants.

Think of all those additional care workers to look after the burgeoning population of elderly. Think of those new doctors and nurses to staff packed surgeries and overstretched wards. Think of construction workers to build the new homes pretty much everyone now agrees we desperately need. Think of the software developers, research scientists, engineers and myriad other skilled workers that Britain will require to drive our national productivity and increase our living standards. We can - and should - certainly fill some of these skilled vacancies through retraining the existing UK workforce.

But not all of them can be filled in this way. Moreover, this is to cut the labour force cake differently. To make the cake bigger, we will almost certainly need to import labour from abroad. But what if the labour doesn't want to come? The latest figures from the Office for National Statistics this week suggested the number of EU-born workers in the UK workforce may also have now peaked at 2.3 million. There are other signs that net immigration from the EU is now in decline. Employers are starting to complain of labour shortages.

The migration expert from King's College London, Jonathan Portes, has predicted a sharp fall in EU migration rates in the coming years for a variety reasons. The assumption among British politicians is that EU migration post-Brexit will be like a tap that can be turned on and off. They will import any new workers we genuinely need, they will "manage" migration, they will "take back control".

But what if the tap is turned and no water comes out? What if there is a supply problem? The UK atmosphere towards immigrants has hardly been welcoming over the past year. There was spike in violence directed at European migrants in the wake of the Brexit vote. The uncertainty over the future rights and status of EU nationals who have made their home here has created anxiety, heartache and anger.

The tone in the most influential organs of the national print media is unrelentingly hysterical and hostile.

Senior politicians have misrepresented the scientific evidence on immigration's impact on living standards. Others have ignored it out of sheer cowardice, scared of making themselves targets of the right-wing press or of going against what they perceive to be the popular mood.

Would it really be surprising if a skilled European worker, or even an unskilled one, faced with a choice about taking a job in Britain and somewhere else on the Continent or around the world, gave us a miss given the repellent tone of our public discourse on migration and the insouciant attitude of our politicians? 

The assumption is that Britain can choose immigrants. But one day, and possibly quite soon, we might wake up to the hard reality that immigrants can also choose Britain. And then we may have cause for deep regret over the way that we have allowed the national conversation about immigrants to unfold."

The idiot economics of Donald Trump's 'Muslim ban' will ultimately hit his own people in the wallet

A moral disgrace. An act of wanton cruelty. A legal outrage. An unconstitutional power grab. A work of gross administrative incompetence. A self-inflicted security wound. But economic idiocy too?

It seems almost otiose to mention money in the context of Trump’s arbitrary executive order barring Syrian refugees from America, capping the overall refugee intake for 2017 at 50,000 and stopping all entry to nationals from seven countries from the Muslim world.

But it’s true. Trump’s order not only defiles America’s founding principles, sullies its global reputation and gives comfort to autocrats the world over, but it will, in all likelihood, ultimately lead to the diminishment of the vigour of the world’s dominant economy too.

One doesn’t need to look far in America for examples of refugees and their families who have made a stunning contribution to the country’s prosperity. Steve Jobs, the founder of Apple, was the son of a man who fled violence in Syria. Sergey Brin, the Google co-founder, was a refugee from the Soviet Union.

Donald Trump announces a ban on refugees and all visitors from Muslim-majority countries

But the economic case for being open to refugees does not merely rest on a handful of entrepreneurial superstars. The idea that these people seeking sanctuary in other states represent an endless burden on taxpayers – something we’ve heard so often in Europe in recent years – is nonsense.

Data from Europe shows that, over time, the employment rate of refugees rises from 25 per cent to more than 60 per cent. In Sweden asylum seekers have shown a bigger increase in employment rates than any other migrant group.

Trump’s apologists stress that the ban is only temporary. Others point out that America in the Obama years only admitted an average of 70,000 refugees a year. It’s certainly true that America has not been pulling its weight when it comes to responding to the global refugee emergency.

But this is really to miss the point.

The economic damage from Trump’s order goes far wider than its direct impact. The bulk of the harm is in the message it sends. The barely disguised discrimination against Muslims tells 1.6 billion followers of that faith that “America does not want you”. 

And the fact that those who had been granted green cards (permanent residence) were initially included in the ban will have sent a chill through any non-American citizen worker, regardless of nationality or religion. The message here is: you can no longer rely on the US government to respect your status, to treat you fairly.Their incentive to stay - or the incentive for others with skills and talents to come to America - has taken a terrible blow.

Many informed observers suspect this anti-immigrant signal is the real goal. And listening to the views of Steve Bannon, Trump’s “chief strategist” and reportedly the driving force behind the executive order, this seems all too plausible. 

Bannon has ranted in the past about US engineering schools being “full of people from South Asia and East Asia” and objected to the number of Asian Silicon Valley chief executives. “Twenty per cent of this country is immigrants. Is that not the beating heart of this problem?” he once asked.

This is no finessing this. What we have here from the mouth of Trump’s right hand man is the raw voice of nativist bigotry.

It is also the voice of economic folly. America is a country settled by immigrants and whose spectacular economic success is built upon successive waves of mass immigration from people from all over the world of all faiths and ethnic backgrounds. It has prospered enormously on the back of immigrants’ inventive talents and hard work.

This noxious executive order is likely to be just the beginning. It sets the ugly and profoundly un-American tone. The longer Trump and Bannon control immigration policy in the US, the greater the damage that we can expect to be inflicted on the most productive national economy the planet has ever seen.