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Why Are So Many Foreigners Still Working in the UK?

London Banks Brexit
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August 17, 2017 By: , No Comments

In the months following the Brexit referendum in June 2016, net migration from Europe has slowed, but remains at elevated levels. Official stats indicate that large numbers of European Union citizens remain in the United Kingdom (April through June 2017). Year on year, EU employment in the UK increased by 126,000.

Not only is this the highest number on record since the Brexit vote, it is also the highest EU employment level in 2 decades. The stats point to increasing levels of employment with foreign-born workers in the United Kingdom. Annually, the trends are declining, but remain elevated. By Q2 2017, the number of foreign workers in Britain rose to 1 million. In the final quarter of 2016, this number was just 947K.

East European Countries Lead the Way

Between April and June 2017, there has been a steady increase in the number of Bulgarians and Romanians working in the United Kingdom. These countries joined the European Union in 2007, and the UK lifted restrictions on nationals from these countries in 2014. For the period in question, there were 337,000 documented Bulgarians and Romanians working in Britain. Countries which joined the EU in 2004 – Slovenia, Slovakia, Latvia, Poland, Lithuania, Czech Republic, Hungary, and Estonia had 997,000 workers in the UK.

Year on year, this figure is 11,000 less, and it also marks the first time since June 23, 2016 that the EUA8 countries have less than 1 million people working in the United Kingdom. The general trend among non—EU nationals is also declining, with the number of foreign workers at 1.2 million, down by 18,000 year on year. The numbers are strictly reserved for employment-related records and do not indicate those who have entered the country as migrants, or unemployed people. The recent data on UK employment figures was released by the ONS on Wednesday, 16 August 2017. This information is important in that it reveals an interesting trend in the United Kingdom: the Brexit has not adversely affected the desire of people to work in the United Kingdom.

The notable differences to these figures are Bulgaria and Romania. Since these countries were granted unimpeded access to the UK’s labour market in January 2014, the number of workers in Britain has boomed. Earlier in 2017, the Office for National Statistics (ONS) released data indicating that net immigration had fallen with EUA8 nationals. More nationals from these countries were leaving the UK than entering it. Annual changes in migration data have been notable, with a slowdown evident across the board.

UK Remains an Attractive Destination despite Media Hype

The employment data does not provide any information on the type of employment that European Union nationals are doing. However, CIPD (Chartered Institute of Personnel and Development) indicates that 33% of EU 8 countries and EU 2 countries are involved in rudimentary occupations such as construction, cleaning, hospitality etc. Meanwhile, foreign workers from the 14 European Union nations are typically employed in a professional capacity.

Much of the hype about the UK’s declining attractiveness to foreign workers is overblown. The United Kingdom maintains a vibrant economy with a huge, well-developed financial sector that will remain a power player even after a Brexit has been negotiated. Many new jobs are being generated, and for many East European workers the wages in the UK are a major enticement to leave their home countries and seek employment in the United Kingdom.

The latest jobs data from the UK indicates that UK jobs are enjoying strong growth. 125,000 people were employed in the 3 months ending in June 2017. Some 75.1% of people between 16 – 64 were employed, marking the highest employment rate since 1971. However, the reduced productivity of these workers is cause for concern. Hourly output dropped 0.1% in Q2 2017, after plunging 0.5% in Q1 2017. This will reflect positively for the UK economy, and the GBP will certainly rally.

 

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Brett Chatz

About Brett Chatz

Brett Chatz is a graduate of the University of South Africa, and holds a Bachelor of Commerce degree, with Economics and Strategic management as his major subjects. Nowadays Brett contributes from his vast expertise in online trading for spreadbettingreview.co.uk.

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