Report: Social Market Foundation Predicts A 58% Drop In Expats Moving To The UK

For many decades now, the United Kingdom has been drawing expats of all ages from around the world to work in a multitude of industries. This is mainly because of the lifestyle it offers, which includes factors such as good living standards, education, healthcare, infrastructure, career opportunities and other similar benefits, to name just a few.The country’s expat life has gained so much popularity around the world that it is hardly surprising to know that there are more than 8 million immigrants from other nations settled in the UK and close to 50% of these expats are from the EU member nations. While a small number of the expats and migrants move to Scotland, Wales and Northern Ireland, a majority of them are based in England. According to BBC reports, in the last decade or so, around 41% of foreigners claimed benefits that are sponsored by the state, including healthcare as well as voting rights.

However, things have changed considerably across the UK ever since the Brexit referendum has taken place. The country has seen a reduction in the number of expats, especially those from the European Union member nations. According to a report published by the Social Market Foundation (SMF), this trend is likely to continue, and by next year, net migration to the UK could go down by as much as 58%. This analysis is based on net migration, an increase in unemployment, and falling job vacancies in the wake of Britain’s decision to leave the EU; it provides three forecasts regarding net migration between 2016 and 2020.

Forecast #1

The central forecast is based on potential net migration figures as per the unemployment trends. It has been estimated that fewer expats will move to the UK because of the country’s rather bleak economic outlook. Going by the current scenario, net migration is like to fall to 162,000 by the year 2018 and 131,000 by 2020.

However, these figures have been predicted only by considering how migration reduces when unemployment rises. In fact, it could be even lower if the authorities pass any actual policy changes on migration, such as more stringent immigration rules. If strict policies are introduced and implemented by the Conservatives, the UK could receive even fewer migrants than what has been estimated and the net migration could be a lot lower than 58% in the worst case scenario.

Forecast #2

The second prediction is based on a more pessimistic outlook, in which the UK makes a complete exit from the Single Market. In this situation, the fall in net migration could be even higher, to 130,000 in 2018 and 99,000 in 2020. This is actually good news for the Conservatives, as they will meet their net migration targets in the next four years. Unfortunately, the economy is likely to suffer in such a situation.

Forecast #3

The last forecast of the report has been based on the early post-referendum figures, as well as the impact that the “Leave” vote has had on job vacancies. It predicts that the overall net migration across the UK is likely to go down by 58% in the coming year. In this situation, the Conservatives may hit their migration targets as early as 2019. Of course, this is no cause for celebration as it will come at a very high economic cost

Immigration in the UK

For several years now, immigration has become a hugely salient political issue. Millions chose to move to the UK at a time when its economy was in a better state as compared to some of the other nations across Europe. In fact, there is a major difference in employment levels and wages between the UK and some of the other European countries.

The foreign-born population therefore increased rapidly over a period of time, even though the government tried to control it by putting tighter immigration policies into place. These included income thresholds for outsiders and restrictions on family visas. The UK’s net migration would have definitely been a lot higher if these policies had not been implemented.

On the other hand, people from the European Union member nations did not require a residence visa to live and work in the UK for up to six months. Moreover, they could settle down for a longer period of time, as it was much easier for EU citizens to obtain the necessary permits because of agreements among the various members. Employers in the UK could hire EU nationals for a relatively short period of time (up to 6 months), at a lower rate and without paying any additional amounts on their paperwork. As a result, a large number of jobs went to immigrants from the EU.

Critics believe that the drastic rise in the number of Britain’s foreign-born residents is a direct consequence of the Labour’s Mass Immigration policies.

The impact of net migration has also been felt by the public. According to polls conducted recently, more than 50% of the local population said that immigration was the number one issue that the country was facing. Evidence suggests that this was the primary reason that a majority of Brits decided to opt for the “Leave” vote during the referendum. Most Brits believe that the number of EU nationals moving to the UK each year would reduce if the country were no longer a part of the Union.

Since migration has always been on the higher side by historical standards, the former British Prime Minister David Cameron made a promise to reduce the number of foreigners in the country to a figure that was in the tens of thousands. This was a target that the Conservatives never managed to hit. Most experts are of the strong opinion that this failure was primarily responsible for a majority of the people choosing the “Leave” vote in the Brexit referendum, which in turn led to David Cameron’s resignation.

Across the globe, job opportunities and unemployment have a strong correlation to net migration levels. Economic gurus state that contrary to what the Brits believe, the “Leave” vote will bring about a difficult time for the UK, leading to a reduction in economic output. Brexit is likely to cause severe economic instability across the country. This could mean higher unemployment rates and fewer job opportunities than if citizens had chosen to remain within the EU.

EU citizens currently living in the UK are on the whole disappointed, angry and bitter about the decision. Many of them don’t have stable employment in spite of completing their specialized education. The UK is no longer the tolerant, welcoming country they once thought it was. Some of them have faced outright discrimination and hostility for being born in another nation.

Many Brits aver that while they voted for the UK to leave the EU, they aren’t against European immigration, even though their schooling, housing, healthcare and welfare systems are oversubscribed. In an attempt to reassure EU Citizens, London’s Mayor Sadiq Khan issued this message:

To every European resident living in London, you are very welcome here. As a city, we are grateful for the enormous contribution you make and that will not change as a result of this referendum. We all have a responsibility to now seek to heal the divisions that have emerged throughout this campaign and to focus on what unites us, rather than that which divides us.

However, Europeans are no longer drawn to the UK like they once were.

Australians in the UK

The impact of Brexit will definitely go way beyond British and EU citizens. In fact, the country has been seeing a steady decline in immigrants from certain nations, especially Australia, for several years now.

The commonwealth bond between the UK and Australia is a strong one as it is built on a solid history; the two countries fought side by side in both the world wars. In current times, both the nations enjoy a longstanding friendly rivalry in major sports like cricket and rugby.

According to the BBC, the path to the UK was well worn by many young Australians in the past. A majority of them made spots like Manchester and Edinburgh their long-term home. However, in the last year or so, the number of Aussies arriving on British shores has fallen drastically. To make matters worse, they have been abandoning the UK in their thousands. The number of work visas issued by the Home Office fell to 15,000 between 2011 and 2012. This is less than half compared to 2006. This was accompanied by the closure of various Australian businesses too. The membership of the Australian-British Society has fallen by more than 30% in the last couple of years.

Australians, being well-trained, educated and fluent in English, often found it easy to get jobs in the UK. However, the government made it very difficult for them to get employment visas. In 2011, the authorities abolished the general visa category, under which Australians used to apply for their residency and employment permits. In addition to that, a cap of 20,700 was introduced on the number of Australians that could be sponsored by UK Employers. A further 1,000 were granted permits only if they were “exceptionally talented”.

Previously, it was possible to sponsor Australians so that they could stay on beyond their visas if they were in hospitality management roles. Since that is no longer allowed, many hotels and establishments have lost out on well-qualified and experienced managers. Such factors deprive the UK of positive contributors to the economy.

According to the Home Office, the changes in the visa policies should not have a major impact on the number of Australians that legitimately move to and work in the UK. They believe that the cap of 20,700 actually represents an increase of around 7,000, as compared to the number of Australian skilled workers sponsored in 2009. London’s former Mayor, Boris Johnson, disagrees with the restrictions though and decried them as an “absurd discrimination” against them.

There are other factors that have caused Aussies to return home. The Australian Dollar has become stronger and is now worth more than what it was earlier. The locals believe that they can get paid more for doing the same job in their home country. The economic conditions across Australia are also better than they used to be and there are more career opportunities available across the nation.

Reasons for Decline in Net Migration

EU Citizens will now have to obtain the required residency and work permits if they want to settle down in the UK. Since they no longer have an added advantage, they are just as likely to move to other countries.

Outsiders are also now hesitant about moving to this country, since the economy is not as stable as it was a few months ago. Unemployment, which was at a high 7%, is expected to increase and people will have fewer career opportunities than before. Many foreign students have had to go back home after spending huge amounts on their British higher education.

Also, the cost of living in the UK is very high and is likely to increase because of Brexit, which has made survival more difficult for the locals as well as foreigners.

The Brexit vote has also caused many foreigners – both EU and non EU citizens – to feel discriminated against. Many are of the opinion that they are no longer welcome in the UK.

Effect of the Decline on Great Britain

Migration trends and demographics vary a great deal across the three nations that form Great Britain. Scenarios of their future populations are reflective of these differences. As per the forecasts and projections, England should face the highest population growth in the next two decades. During the same period, Wales will probably see the slowest population increase. In Scotland, the only determinant of long-term population growth is net migration. This means that without the inflow of expats, Scotland’s population will remain stable in the next decade and perhaps even decrease over a longer period of time.

Sources: [1], [2]