ICAR

are immigrants, refugees and asylum seekers an economic advantage?

There has been recent recognition in the UK, and the rest of the industrialised world, of the increasing reliance on economic migration to fill skills gaps and compensate for the declining indigenous population and an adverse ratio of people of wage earning age to the rest of the population. However, refugees and asylum seekers are not the same as economic migrants.

Economic migrants obtain entry to the UK on the basis of work permits issued by the Home Office for skilled and unskilled jobs that need to be filled. Previously this entry route was very restricted, but it has recently been broadened by the Home Office’s managed migration policy.

Asylum seekers claim safe haven from persecution. Refugees are asylum seekers whose cases for safe haven have been accepted under the Refugee Convention 1951 and relevant UK legislation. While refugees have an important contribution to make to the economy, their claim to settle in the UK is based on their reasons for flight from their country of origin, not on the skills they bring to the host country, great though these may be.

Little is currently known about the economic contribution of asylum seekers and refugees in the UK as existing data sources generally fail to distinguish between refugees and other migrant groups. Furthermore ethnic monitoring categories and methods used by official data sources such as household surveys often do not capture refugee populations adequately. However, recent studies have produced conclusions as to the contribution of migrants generally. A Home Office study published in 2002 estimates that migrants contributed £2.5bn more in taxes than they consumed in benefits and services in 1999/2000. However, migrants are a heterogeneous population and their labour market outcomes vary. Another Home Office study has suggested that migrants from ethnic minority groups have significantly lower levels of employment and wages than the UK-born population, with different ethnic groups experiencing greater success in the labour market than others. Although the level of qualifications of amongst migrants is very varied, this research also suggests that many migrants are very well educated, with more studying to degree level than the UK-born population and therefore potentially have much to contribute to the UK economy.

Recognition recently that refugees have a range of skills and qualifications useful to the UK has led to a series of initiatives to record them (see section on skills audits below). NIACE research in 2001 involving interviews with 70 respondents from 21 different countries living in Leicester revealed a high level of education, skills and qualifications with the intention of matching them to skills needs in the local area. A recent programme developed by the London Framework for Regional Employment and Skills Action (FRESA) and the London Skills Commission, targets London’s refugees to help fill the chronic skills shortages in health and construction sectors. London Skills Commission research revealed that refugees were often skilled in the very sectors that are understaffed, which includes engineering and teaching as well as construction and health. The NHS plans to recruit and retain more health care professionals, estimating that it will need 45,000 extra health professionals over the next five years to meet London’s rising demand for services. Similarly a construction skills programme responds to the expected need for 10,000 construction staff ranging from qualified engineers to bricklayers to deliver London’s key building projects.

Studies have suggested that asylum seekers and refugees have higher than average educational, skills and qualification levels, high levels of motivation, and that the majority are young males of working age. Given these characteristics, it is likely that, along with other categories of migrants, refugees and asylum seekers have a great deal to offer their host country if initial obstacles can be overcome. Unlike economic migrants, people seeking asylum do not arrive in the UK ready to enter the labour market, but in need of safe haven from persecution, and may have to overcome barriers such as trauma of flight and exile, uncertainty of status and English language. However, despite the lack of data that identifies the contribution of refugees and asylum seekers as a group, the evidence on individual contributions to the UK economy suggest that these barriers need not be insurmountable.

On the basis of available data, it has also been concluded that contrary to popular perceptions, migration does not have a significant impact on overall unemployment amongst the existing UK population, including previous migrant groups. Similarly, migration was not found to have an adverse effect on the wages of the UK population, indeed if anything, immigration was found to have a positive effect on the wages of the existing population. Findings from such research accord with both international and European evidence on this issue and have influenced the change of government policy on inward migration.

As of July 2002, asylum seekers are not permitted to work in the UK until their claim for asylum has been approved. This constitutes a significant barrier to any potential economic contribution they might make, both in terms of its immediate restriction on employment but also in terms of the long-term effects of periods of forced unemployment.

Last Updated: 12/03/07

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