Summer 2023 – UK Immigration Policy Dilemma
Published on 23rd Jun 2023
The UK Government is trying to tackle a number of problems that are linked to immigration, but require contradictory solutions – inflation in food prices, increase in net-migration and a shortage of skilled workers.
Inflation and immigration are not normally subjects easily joined, but the International Monetary Fund have commented on the UK economy. Gita Gopinath (Deputy Managing Director of the IMF) said recently that "with inflation as high as it is... there are benefits to having workers come in".
Ms Gopinath added, "In this context, with inflation as high as it is, having workers who can fill the shortages in some of the sectors that we're seeing right now will help with bringing inflation down,"
The latest UK Government statistics showed the UK still had more than one million vacancies in the three months to April 2023. The industries with the highest vacancy ratios were accommodation and food (5.5%), health and social work (4.5%) and professional scientific jobs (4%). Economists have identified the UK's tight labour market, exacerbated by the impact of Brexit on flows of European Union workers and the impact of the Covid pandemic, as one of the main contributory factors to high domestic inflation.
One of the obvious impacts of Brexit was the end of freedom of movement which meant that not only did new EU nationals coming to the UK need work permits, but also under the work permit regime, there are minimum salary and academic criteria that need to be met.
In a statement the Treasury said the UK had "moved away from the old model of unlimited, unskilled migration".
"We now have a points-based immigration system, giving the British people full control of the country's borders, which is designed to flex to the needs of the economy to ensure we have the skills we need."
"We want businesses to invest in our domestic workforce to fill labour shortages, but where there's an acute need for staff, we have also been flexible, including putting care homes and the seafood industry on the shortage occupation list."
