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February 20, 2020

UK government vows to end reliance on “cheap” foreign labor post-Brexit

UK government vows to end reliance on “cheap” foreign labor post-Brexit

The UK government has unveiled its new post-Brexit points-based immigration system with a promise to end a reliance on “cheap, low-skilled labour” from the EU.

The system will award points to applicants based on specific skills, qualifications, salary, English-speaking ability, and profession, and will implement recommendations from the Migration Advisory Committee to lower the salary threshold from the current £30,000 minimum limit to £25,600.

The reforms, which the government refers to as an “Australian-style” system, are due to come into force in January 2021.

The UK Home Secretary, Priti Patel, believes the proposed scheme will attract the “best and brightest” from across the globe to live and work in the country. However the UK’s opposition parties disagree.

Labour’s Shadow Home Secretary Diane Abbott says that it will be difficult for the UK to attract the workers it needs at all skill levels because of the Conservative government’s “hostile environment” immigration policy.

Liberal Democrat home affairs spokesperson Christine Jardine has also warned that businesses are already struggling to hire workers without the Conservatives stopping them “recruiting all but the highest paid employees from abroad.” Firms in care, construction, hospitality, and food and drink could potentially the most badly affected.

Jardine also cautions that “ten months is nowhere near enough time for either employers or the Home Office to get ready for these new rules.” She believes they will create “chaos and confusion.”

Alex Reilly, professor of law at the University of Adelaide, points out in the Financial Times the areas where the UK government’s plans differ from the Australian system. The most obvious of these seems to be in the failure of the proposals to provide a route of entry for independent skilled workers without a specific job offer. Of the visas obtained in Australia over the period 2018–2019, 54% were granted for this type of worker, with only 38% given to those with a job offer. 

The government’s plan does contain a Global Talent scheme which will grant visas to “highly-skilled” scientists and researchers without a job offer, but this is potentially a very small pool of individuals.

The Seasonal Workers Pilot will also be rolled out further, providing 10,000 places in time for the 2020 harvest. The National Farmers’ Union suggests a much larger figure of 70,000 is required.

Abdurrahman B. Aydemir, in his IZA World of Labor article, notes that although “[l]abor market prospects are better for skill-based immigrants than for other immigrants … skill-based admission will not solve all the economic outcome problems of immigration, including weak economic integration.” Aydemir stresses the need for policies to “reflect labor market characteristics and the applicant pool. To maximize benefits, immigrant selection policies should be complemented by economic integration policies to ease the transfer of foreign human capital.”

Massimiliano Tani, also for IZA World of Labor, advises that for points-based systems to be developed effectively “large and detailed data collection on the immigration process and on immigrants’ performance over time,” is required. Such surveys are vital for informing policymakers, he says, and the “[d]ata need to be regularly reviewed to test whether the point system is achieving its objectives or needs to be revised.”

Read more from IZA World of Labor about how migration policy affects the labor market.