James Ashton: We need clever migrants to boost the UK economy

Pledges to curb immigration don’t recognise the vital skills foreign nationals bring to this country
Good for business: Google co-founder Sergey Brin is a Russian immigrant who was welcomed into the US
James Ashton10 July 2014
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All the talk was of deepening economic ties in Mumbai as George Osborne visited India’s incoming prime minister, Narendra Modi, this week. The Chancellor cited a 50 per cent increase in exports to India since he took office, with imports travelling in the other direction having gone up by a third.

What didn’t get much discussed, except perhaps on the sidelines, is a less encouraging trend: a drop-off in Indian students coming here to study. And to think that one of Britain’s top exports to the subcontinent is education.

It isn’t just students from outside the European Union who are thinking twice about whether they will be welcome. The business world has worries too. For a Government that is decidedly pro-business, it has tied itself in knots on immigration. To encourage free trade flows but try to block the movement of people smacks of inconsistency. It is no wonder that David Cameron has cooled on his commitment to reduce net migration to fewer than 100,000 a year, when the figure currently stands at 212,000. But as Ukip pledges tighter border controls in the General Election next year, it will remain an incendiary issue.

In the meantime, there is evidence that companies are being forced to fish in a smaller pool to recruit highly skilled workers, with a drop in recruitment from outside the EU being offset by job hires from inside it. Such a trend risks blunting the edge of international companies that choose to be based here.

So onerous is the regime that Alistair Cox, the boss of recruiter Hays, complained in this paper that “arbitrary hurdles” meant that small companies would rather leave a role vacant than get it wrong and large firms might set up new wings elsewhere.

In London, one might ask: what is the problem? Foreigners flock here all the time, whether as tourists or workers. The capital is powered by migrants. Not only is it home to everyone — hence the tears in one part of the city on a World Cup night, and jeers in a rival community just a few miles away — but they range from the barista to the barrister. It means that the stress on public infrastructure and housing is perpetual, not just because of the newest arrivals. We are victims of our own success.

There is a legitimate call for more immigration. The latest survey from the London Chamber of Commerce and Industry acts as a reminder that the capital’s vibrant job market will push up wages soon. Half of London firms that are recruiting report difficulty in finding the right people to fill a role.

New figures from the Migration Advisory Committee show how far foreign-born workers have come, filling 16 per cent of low-skilled jobs nationwide compared with seven per cent in 1997. Their arrival doesn’t solve the youth unemployment crisis which means 850,000 16- to 24 year-olds are out of work, but it does fill the gap left by those that won’t work or can’t.

The equation is complicated. Young Brits aren’t taking the low-paid jobs that at least get them on the employment ladder. Some of them don’t have the soft skills such as good manners and confidence to get on in the workplace. And as the RSA City Growth Commission pointed out in a report last week, those that do take on these roles are a source of untapped potential if only they were better supported in clambering up the ladder. Most of them are women, who return to the workforce after having children into part-time roles or jobs with a fraction of the responsibility than they had before.

So the paradox is that employers are crying out for more skills yet, as the RSA report notes, 4.3 million workers are overqualified for the job they are doing and nearly 20 per cent of part-time workers want full-time work but can’t find it.

Part of this problem can be traced back to the British educational disease: great universities but substandard state schools. At the Royal Academy of Engineering awards last week, diners I talked to singled out the standard of physics teaching in this country as a key reason why we don’t produce nearly enough engineers.

Such mismatches will take a generation to fix. Pulling up the drawbridge until we do so will not help the British economy. As well as the workers, we should capitalise on the international pull of our universities, not jealously guard course entry.

Naysayers need to look a generation out. As the vice-chancellor of Cambridge University, Leszek Borysiewicz, himself the son of Polish refugees, said in an interview last month, it is often the university applicants who are children of immigrant parents who value education most highly.

Sergey Brin, the co-founder of Google, is a good example. He was born in Moscow but moved to America when he was six, eventually taking a PhD in computer science at Stanford University. That’s where he met Larry Page. The pair set up shop in a garage down the road soon after and the rest is history.

No wonder that Imperial College is working harder to keep close ties with the talent it fosters. There is a Stateside saying that they should staple a green card to every diploma. Vacuum cleaner entrepreneur Sir James Dyson cites the figure of 90 per cent of people doing postgraduate work in Britain come from outside the EU. Are these incomers depriving Brits of an education? I doubt it. But there is a chance they will create wealth and jobs if they are encouraged to stay after their studies.

We have to put a more intelligent filter on the people who come into Britain. Spongers need not apply. But quotas are not the answer, unless we want to exclude the very people that can help power the economy, not drain it.

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