UK is magnet for highly educated EU migrants, research shows


UK passport control
The study shows that Britain is better than any European country in attracting the most highly skilled migrants. Photograph: Rex Features

UK is magnet for highly educated EU migrants, research shows


The positive impact of recent European migration to Britain is highlighted by the fact that the UK now attracts the highest number of university-educated migrants of any country in the European Union, according to new research from University College London.

The study, published in the Economic Journal on Wednesday shows that 62% of migrants from western Europe – the A15 countries such as France, Italy and Spain – who come to Britain each year have a university degree compared with 24% of the British labour force.

The authors put a figure of £6.8bn on the value of the overseas education received before their arrival by migrants who have come to Britain since 2000.

The study, The Fiscal Effects of Immigration to the UK, by UCL’s centre for research and analysis of migration, is largely based on the Labour Force Survey. It shows that recent EU migrants pay more in taxes than they receive in benefits, helping to relieve the tax burden on UK-born workers and making a positive contribution to funding public services.

The authors, Prof Christian Dustmann, the centre’s director, and Dr Tommaso Frattini, calculate that the positive fiscal contribution of EU migrants amounted to £20bn in the decade to 2011.

Their calculation of the benefit comes even before an estimate is made of the contribution that EU migrants make in fuelling Britain’s economic growth through their working lives.

The findings come as Britain engages in a heated political debate over the country’s future in the EU and the threat to leave if the UK cannot win important concessions to curb “benefit tourism” and limit the free movement of workers within Europe.

The UCL study does find that migrants from outside the EU have cost the country more in public services than the fiscal contribution they have made in taxes and national insurance. The figure, £118bn over the period 1995-2011, is mainly due to their larger family sizes and lower employment levels.

However, the authors add that this was true during the early part of the 16-year period, but more recently non-European migrants have also made a positive fiscal contribution – about £5bn more in taxes than the amount they receive in benefits.

The impact of new migrants from outside Europe, including India and Pakistan, has become less important politically as the government has shown that it can restrict their numbers through visa controls, particularly for overseas students and those coming for family and work reasons. This has led to migration to Britain from outside Europe reaching its lowest levels since the 1990s, while EU migration has surged in a way that has set political alarm bells ringing across all the parties.

The UCL report, however, provides strong evidence that Britain is remarkably successful at attracting the most highly skilled migrants, performing much better than any other European country.

The main findings of the report include:

Cost: the positive net fiscal contribution of recent migrants since 2000 from the east European accession states, including Poland, amounts to £5bn; those from the rest of the EU, including western and southern Europe, have contributed £15bn, and those from outside Europe more than £5bn. The authors contrast this with the negative fiscal contribution of the UK-born workforce which has helped fuel the accumulated deficit of almost £617bn.

Profile of migrants: the average age of migrants in Britain in 2011 was a little more than half that of the British labour force, an average of 26 compared with 41 for UK-born workers.

European migrants who have arrived since 2000 are, on average, better educated than the UK-born labour force. In 2011, 25% of migrants from the A8 eastern European countries had a university degree compared with 62% for those from the A15 countries in western and southern Europe and 42% for migrants from outside Europe.

The detailed figures show that even in the case of Poland and other east European countries, the educational qualifications of those coming to the UK have increased in the past decade from 6% university graduates in 2004 to 25% in 2011 although they may be filling less skilled jobs.

It shows that the education gap between migrants and the British labour force is growing: the proportion defined as with “low education” is 53% of the British workforce, 8-13% of recent EU migrants and 15% of those from outside Europe.

Work: European migrants overwhelmingly come to Britain to work. East Europeans have an employment rate of 81%, while 70% of western Europeans are in work(£9.30) and 59% of non-European migrants are in employment (£7.90). They may be more highly qualified but that is not yet reflected in their average earnings.

Benefits: the authors also looked at how likely migrants were to be in receipt of welfare benefits including in-work benefits such as tax credits and child benefit. They estimate that migrants since 2000 have been 43% less likely to get state benefits or tax credits compared with the UK-born labour force and 7% less likely to live in social housing.

These figures are borne out by the latest Department for Work and Pensions statistics, which show that only 113,000 out of the 4.2 million people claiming key out-of-work benefits in Britain are European migrants. When the unemployed jobseeker’s allowance is looked at in particular, it shows that it is being claimed by only 64,000 EU migrants out of the 2.3 million who are resident in Britain. The figure includes 14,000 Poles.

Conclusion: the recent wave of immigration that has driven the sharp rise in the UK’s foreign-born population has not been a drain on Britain’s finances but has actually made a substantial contribution. This, the authors say, is in stark contrast to the view often maintained in the public debate.

Dustmann and Frattini say that even though Britain cannot regulate migration from within the EU, the UK is increasingly able to attract highly educated and skilled migrants: “This surprisingly positive trend, which continued even throughout the last recession, distinguishes the UK sharply from other European and non-European countries. This ability to attract highly skilled immigrants – even from within the EEA, where no restrictions can be imposed, is a strong and important feature of the UK economy.”