Who needs migrant Workers? Martin Ruhs, Migration Observatory, COMPAS
Who needs migrant workers?Labour shortages, immigration and public policy Martin Ruhs Migration Observatory, COMPAS, University of Oxford
OverviewPart 1 - Labour immigration policies in HICs:aims, constraints, variable national policy spacesPart 2 – Key features of labour immigrationpolicies in HICsPart 3 – The policy question: how can we linkimmigration to the “needs” of the domesticlabour market and economy?Part 4 – Discussion: What role for supra-nationalpolicies?
3 core questions of labour immigration policyHow to regulate:1) Numbers (e.g. employer-led, quotas, fees, etc.)2) Selection (e.g. by skill, nationality – points based systems; bilateral agreements)3) Rights (e.g. temporary or permanent; access to labour market; access to welfare state; family reunion; access to citizenship)
Labour immigration policy: aims and constraintsDefining the “national interest” (objectives):• economic efficiency (e.g. growth; competitiveness; fiscal ef)• distribution (e.g. protect lowest paid; and others?)• national identity and social cohesion (what is it?)• public order and national securityConstraints and variations:• state capacity to control immigration• the „liberal constraint‟: dom. liberal institutions; int. commit.• Inst. variations: polit. systems, prod. regimes, welfare
Choice under constraints• States decide on openness, selection and rights based on objectives (variable) and constraints (variable; binding in short term)• Variations and constraints define and circumscribe the “policy space” for the regulation of labour immigration at national level Variation across countries and over time
1. TMPs predominate2. PMPs limited to high skilled 6
3. Openness positively related to skill level targeted (H1) 0.72 0.7 Openness index 0.68 0.66 0.64 0.62 0.6 All (104 programmes) Upper HICs only (71 programmes) 7
Regulating OpennessQuota:• existence, type and size of quotaDemand restrictions:• job offer; labour market test; limited occupations/sectors; economic fee; conditions of employment; trade union involvementSupply restrictions• nationality and age; gender and marital status; skills requirements; host country language skills; self-sufficiency 8
4. Modes of immigration control by VoC Quota 1 Self-suff Job offer 0.75 Language 0.5 LMT 0.25 Skills 0 Sec/occ Gen/ms Fees Nat/age Conditions T. Union liberal (22) coordinated (19) mixed (15) 9
5. Variation in restrictions across different rights (all programmes , 2009) 10
6. Rights restrictions inversely related to targeted skills (H2) , all programmes , 2009) 11
The policy question: how tolink labour immigration to the “needs” ofthe domestic labour market and economy
What and whose “needs”?Two approaches:1. Human capital approach: admission oftenwithout a job offer2. Shortage approach: linking the admission ofnew migrant workers to the “needs” of thedomestic labour marketAre migrant workers needed to “fill labour andskills shortages” and “to do the jobs that localworkers cannot or will not do”?
cap threatens the firms were considering moving jobs economic abroad because they could not recruit the staff they needed recovery and BBC, 21.09.10 Britain’s ability to attract foreign A cap on migrant workers investment will hurt London’s economyPwC warned that businesses were "struggling tooperate"Telegraph, 24.11.10 immigrants made immigration cap on non-EU workers will do nothing but create skills a "substantial shortages for important industries in net contribution the UK to the UK fiscal Telegraph, 24.11.10 system" Independent, 24.7.09 Farm migrants vital in east England 16
The problem with “skills” and “shortage”Skills:• Conceptually and empirically ambiguous• Credentialised vs non-credentialised; experience; “hard skills” vs “softs skills”• Demand for employees with specific personal characteristics and “attitudes” (good “work ethic”; “compliant” and “cooperative”)Shortages:– No universal definition? Demand for more workers at prevailing wages?– Why not let wages rise? 17
Identifying shortages using labour market data• Common measures – Change in wages, employment, unemployment, etc. – Vacancy rates, hard-to-fill vacancies, SSVs etc.• US Bureau of Labour Statistics (1999) – Employment growth at least 50% faster than average – Wage increases at least 30 percent faster than average – Unemployment rate at least 30% lower than average• UK‟s Migration Advisory Committee (MAC) 18
MAC “top-down” indicators of shortages of pharmacists 19
Alternatives to immigration• Alternatives – Increase wages, improve working conditions; training – make production process less labour intensive – relocate to countries where labour costs are lower; – switch to production (provision) of less labour- intensive commodities and services;• How do employers decide? – Relative cost matters – Path dependence ….. no going back?
“System effects”: how public policies create demand for migrant labour• e.g. construction in UK – Fragmented industry; low levels of labour market regulation; temporary, project-based labour; casualised employment; no comprehensive vocational education and training system• e.g. social care in UK – Publically funded and privately provided – Councils budgets have kept wages low – Demand for low-wage flexible workers
Growing reliance on migrant labour: choice or inevitability?• Demand for migrant labour arises from broad range of public policies and institutions that go beyond immigration policy• Immigration and public policy: mind the gap 24
The UK’s Migration Advisory Committee (MAC)• Established by Labour Government in 2007, retained under current Cons-Lib Dem Coalition Government• Independent committee of 5 academic economists, supported by secretariat• Advises Home Secretary on labour immigration policy• Advice public but non-binding• Shortage occupation list: “skilled”, “shortage”, “sensible” 25
Discussion: Harmonising labour immigration policies across EU countries: - what - why - howstarting point: default is national regulation:what is the case for supranational regulation?
More information and analysis at: www.migrationobservatory.ox.ac.uk Contact: email@example.com@compas.ox.ac.uk