There are ‘serious problems’ with relying on migrants to lift economic activity and mend the public finances, a top official at the government’s fiscal watchdog has said.
Economics professor David Miles, a member of the Office for Budget Responsibility (OBR) spending committee, said the government’s policy shift to prioritise getting people born in the UK back into work to fortify the jobs market, in preference to workers from overseas, was correct.
In an essay published by the Common Good Foundation, seen by The Times, Miles said: “The fiscal benefits of raising the incomes of those who are born in the UK and who might be on a trajectory of consistently below average wages are as great as the benefits of having more people come and stay in the UK with average or, especially, well above average earnings.”
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Living standards in the UK have barely improved since the 2008 global financial crisis, in part due to sluggish productivity growth within the workforce.
Miles said: “Immigration – which primarily involves those of working age who are many years away from retirement – both delays the impact of the ageing of the population and is the driver of population growth.
“Some conclude from this that a faster rise in the population … will be beneficial in alleviating acute underlying fiscal pressures.
“But, even setting aside the fact that it is GDP per capita that matters for average standards of living —and growth in population does not obviously boost it — there are serious problems with the idea that faster population growth can consistently alleviate fiscal problems.”
Miles’s comments come after figures published by the Office for National Statistics revealed that the population of England and Wales expanded by over 700,000 in the year to June 2024 to about 62 million, the second largest annual rise since records began in 1949.
The increase was largely driven by a record increase in net migration, which subtracts the number of people leaving the UK from the number of people entering the country.
However, Office for National Statistics figures from May this year show that immigration for work for non-EU nationals has fallen by a half.
The number of people immigrating minus the number of people emigrating is provisionally estimated to be 431,000 in the year ending December 2024, compared with 860,000 in the year ending December 2023.
Additionally, 517,000 people left the UK in 2024, an increase of 11% on the previous year.
Also in May the government published an immigration white paper that promised strict controls on overseas recruitment and new demands on employers to train domestic workers.
Under the new proposed rules, migrant workers would have to live in the UK for double the time they do currently before they could apply for citizenship. This will rise to 10 years from five, although there would be exceptions for people who make a “high contribution” to society.
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Last month the House of Lords heard warnings that stricter visa rules could damage economic growth and services in the UK. They singled out the cutting of 180 occupations from the Skilled Worker visa and the decision to close the Health and Care worker route to overseas workers for particular criticism.
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