• Internal Code :
  • Subject Code : AFE6017-D
  • University : Bradford
  • Subject Name : Economics

The Rate of Employment in the UK and the Impact of Southeast Immigration on It

Theoretical framework

The research challenge is extremely demanding as it requires the determination of the effect of migration on the employment outcomes of UK workers. The consequences of migration cannot adequately be distinguished from other factors that affect labour market outcomes at the same time. While we are certain that the influence of immigration is independent, it is difficult to ensure that the calculation effects are a quantitative approximation and not the opposite outcome of the impact of migration on the labour force. In addition, assessing aggregate regional impacts can mask dramatically differing local effects.  

Work has made efforts to avoid potential associations between immigrant population size and other characteristics of the local labour market in existing research on the effect of migration on the labour market. The effect of immigration on the labour markets is therefore mostly analysed at national level rather than at local level (Wadsworth, 2016). Researchers in other situations do not use the actual size of immigrant populations in local labour markets, but estimate the size of immigrant population through other factors which are not based in turn on local labour market characteristics. 

Research shows that the geographic trends of poverty and inequality are widespread in the UK (Browne & Hood, 2016). In the past decade, revenue growth across the nation has been very unequal. The fastest rates of growth in the south-east, while the north east experienced the slowest rate of growth. The low-income concentration in general is related to the concentration of other types of social, economic and environmental impoverishment (Jenkins, 2016).

The geographic distribution of disparities in poverty and inequality in Britain was based on several factors. First of all, as elsewhere, deindustrialisation in Britain during the 1960s and 1970s led to the increase in joblessness among people living in areas with the growth of the traditional industries. As for example, in the North East of Britain during the 1970s the manufacturing industry was significantly decreased. During the 1980s and 1990s, the area attracted few new industries, and this region therefore has high unemployment. Conversely, during the 1980's South East and East Anglia developed high-tech, new infrastructure and manufacturing and experienced a large economic boom (Lahiri, 2017). Furthermore, de-industrialization and the further development of technology have not just contributed to the rise in poverty, social dis-inactivity or the deterioration in workplace mobility in the 1980s and 1990s new technology has shortened life and replaced the new skills quickly with new skills, driving employees into job losses and low-quality and low-wage labour.

Thirdly, fragmentation and segmentation of the labour market have led to the structural aspect of the employment market prospects. High-tech companies and high-tech industries generally offer good employment opportunities, job security and high wages in the main labor market segment, whereas positions are generally low-paid and precarious in underqualified businesses and conventional sectors. Low-qualified people are usually caught in these jobs with no prospect of mobility. In short, the geographical distribution of employment opportunities is contradictory, because deindustrialization, technological development and segmentation of the labor market have evident spatial trends and thus add to the space component of labor market opportunities and, ultimately, to social inequality. 

In this section, we concentrate on globalization, which raises the supply of labor. Nevertheless, it must be remembered that not all migrations are related directly (or indirectly). An increasing amount of student and family migration, for example, is likely to have less effect on labor supply than an analogous rise in work migration. The distribution of skills of the labor market is influenced by immigration inflows when migrant skills vary by comparison from those of the workforce in which they live. This results in a disparity in the labor market in different types of work at current wages, education and production levels.

If (work-related) globalization occurs, the change in the distribution of expertise of the labor market expects national revenues to be increased. The rise in national revenue is shared between immigrants (wage earners) and some indigenous peoples (with higher wages and additional revenue from development factors, including human and physical capital). Indigenous people may also benefit from a broader range of products and services and cheaper prices for goods. The argument is clearly based on the jobs of refugees and the lack of bottlenecks that might hinder the smooth transition of the economy. 

Furthermore, the assumption of a deficit of immigration does not suggest that everyone in the host country is also affected. Alternatively, economic theory indicates that indigenous people who have competencies that exceed the structure of the emerging migrant population could be negatively influenced, or for a duration, while people with comparable abilities of the immigrant population appear to be affected favourably. Whilst immigration includes an improvement of the country's national revenue, as noted in the House of Lords report in 2008, it is also necessary to take into account the impact on domestic income per capita (GDP), since this is a more fitting indicator of indigenous people's living conditions than the overall level of GDP (Ottaviano et al., 2018). A further leap forward was the recommendation of the Migration Advise Committee (MAC), which indicated that it was necessary to consider the advantages to the current resident population, in other words excluding the migrant communities themselves, when evaluating the gains of immigration (Vargas-Silva et al., 2016).

Long term impacts

The long-term hypothesis of traditional economics is that capital and innovation must respond to globalization and economic change and that the labour market is fully flexible. In fact the concept of perfectly competitive economies in which jobs and resources are completely elastic cannot be fulfilled and therefore this model may not explain exactly what happens in all situations. The experimental analysis will be used to determine whether the data support the theoretical model. The economic theory indicates that in the long term, migration may have no effect on jobs and wages, because over time changes in labour quantities and distribution will be absorbed by changes in the economic structure such as the production mix between sectors. While competitive markets and employment are perfectly flexible across sectors, there will not be a long-term influence on relative incomes as relative resources (skilled or unqualified labour, capital) are changing. Alternatively, shifts in the energy balance and comparative size between sectors are changed. For example, if the demand of skilled workers in a country increases significantly, skilled wages will probably decrease and markets will become relatively more productive in the manufacture of skilled labour-intensive goods. Manufacturing of these commodities would grow, increase the demand for skilled labour, and improve wage equality. 

The change from manufacturing to services in the UK is an indicator of how an economy can handle the changing diversity of skills in the population (Vivarelli, 2015). Of reality, this change could be clarified in many more respects. It is also important that these economic changes will take considerable time and have other social impacts. Therefore, the market may adapt to technological changes, resulting in the production and use of innovations that use the available labor pool more effectively within the economy. For example, by changing from a capital-intensive production model to a labor-intense approach which makes fewer applications of mechanized production methods, workers can respond to the increase to the supply of low-skilled work. Immigration can aid or hinder these changes. Immigrants–especially skilled migrants–will bring benefits by, for example, bringing additional knowledge and development through a competitive effect on production, technology and innovation which will result in a longer-term increase in average wages and employment. But in some situations the ready availability of migrant labor can lower opportunities to improve the productivity of current workers and it is difficult to accurately quantify the complex gains frequently discussed in the literature.

Immigration is further argued that it can increase the efficiency of the labor market. Afonso  & Devitt, (2017) suggests that immigration "greases the labor wheels" as refugees can be more adaptive and flexible than the indigenous population, thus being more likely to move into regions with the best possible economic opportunity. This ensures that they can choose themselves in the places in which they most likely find a job. Greater flexibility due to a relative lack of partnership and social investment may also offer competitive advantages to migrant labor, although the availability and stability of migrant workers in a current diaspora can also hinder them.

Short term impacts

The bulk of analyses on the short-term impacts of globalization are not well suited to quantify effects on economies and over time, but instead rely on static models and neglect correlations between different markets. Such projections suggest that migration may have adverse short-term effects on the labour market outcomes for indigenous people. In the short term, labour and capital are usually considered not to be entirely flexible. Thus, immigration is modelled on a rise in the supply of labour. In this way, immigration will lower the wages of locals, which are perceived to be' replacements' for immigrants (i.e., effectively substitutes for equivalent jobs) and will raise the pay for the local workers, whose credentials complement immigrants ' skills. Immigration also raises the profits of owners and of employers benefiting from increased labour supplies.

Literature review

According to the UK Economic outlook report (2018), in their model, they expect that UK growth will remain moderate in 2018 to about 1.3% and to 1.6% in the year 2019.

That is because the real consumer demand is starting to shrink and business investment is pulled by growing economic and political instability as a result of the Brexit agreements.  The improved world economy and the stable value of the pound has strengthened British imports and inbound tourism, giving a certain amount of support for GDP growth in the UK, which should extend beyond 2018. Over the past 3 decades, London has risen much quicker than other British territories, but recent evidence has shown that London's relative performance has been less evident both on the employment and property markets. Therefore, in 2019-20, London is projected to only grow slightly above Britain's average rate. AI and other technology, including robots, drones and driverless vehicles can replace several traditionally human work while generating many extra jobs, with increasing productivity, real incomes and producing new and better goods. They expect that over the next 20 years, these countervailing displacement and income impacts on employment in the United Kingdom may largely offset each other, with the proportion of existing jobs replaced by AI possibly equal to additional jobs generated. Whilst our key forecasts predict the overall impact on UK jobs to be largely positive, fluctuations in the sector will inevitably occur. In the next 20 years, they forecast that the net growth over employment from AI in the following industries is higher which include, medical (+ 22%), academic, scientific and technical (+ 16%) and education (+ 6%). The most significant net decrease in employment due to AI is expected in the sector: engineering (-25%), transportation and processing (-22%) and administration (-18%). 

The working environment in the South-East Asian region is not unfamiliar to the women. In the nation, the Philippines ranks ninth on gender equality, offering women a chance to participate in politics, have several seats on boards of corporations and so on. Nevertheless, in both domestic and international businesses across the country the absence of diversification in the workforce appears to be extremely visible. The ADB (Asian Development Bank) study states that women in Asia "are on average 70% lower than men in the working force. Amid economic growth, lower fertility levels and expanded education, this disparity persists. Work inequality remains an important variable responsible for pay differences between the sexes. 75 percent of women in the industrialized countries have exceptionally low pay jobs in the service sectors, 15 to 20 percent in manufacturing and around 5 percent in agriculture. 80% of the population are women in many of the industrializing countries ' export production areas-where the majority of work is labor intensive low-cost manufacturing. 

Throughout Britain there are a wide range of factors that impact migrants ‘jobs and poverty, from the differing levels of training and qualifications of refugees, the degree to which Language, family, treatment, social networks are spoken and racism is recognised by the employers of the UK. There is a great deal of concern. Additional data on the use of English by migrants is included in the report, Language use and expertise for adult migrants in the UK Migration Observatory. The labor market practices for migrants are also different from their own wellbeing, which is addressed in the report by the United Kingdom's Migration Institute, Adult Migrants Health in the UK. The employment rate for migrants in 2018 was close on average (74%) to that for UK born (76%). Nevertheless, significant differences occurred between men and women.  Foreign-born men (83 percent) had a higher employment rate than men born in the UK (79 percent). The majority of the countries of origin had more jobs than people in the United Kingdom (except for men who were born in East and South East Asia (71%) and MENA and Central Asia (68%). Regarding the females, the level of employment for all countries of origin are lower than for the UK born women, with the exception of women from EU countries.

Background/historical overview

The implementation of a minimum wage (MW) could have significant effects on levels of employment in an economy. Additionally, the upgrade or annual adjustment of a MW could have various cumulative effects on economic employment levels. The literature so far scarcely differentiates between the implementation and updating of the current MW precisely because we are not following the pre-morning cycle before the adoption of a MW to provide a baseline for calculating the impact in some countries. There is obvious evidence that the level of opposition to immigrants in the United Kingdom is moderately high. The majority supporting the restriction to immigration is clearly presented in Figure 1. Those who support a reduction in the number of immigrants who come to Britain are 58% (one third claims' major reduction' and other 25% suggest' small reduction'). About 30 per cent would rather have the same number of immigrants, but those who support a boost are a small minority. The same question posed in a face-to-face poll in 2013 found that 77% supported a change in numbers indicating a marginally shift in attitudes.

the graph represents data on view upon increasing immigration to UK

Fig. 1 Data on view upon increasing immigration to UK; Source: https://migrationobservatory.ox.ac.uk/resources/briefings/uk-public-opinion-toward-immigration-overall-attitudes-and-level-of-concern/

There is no new resistance to refugees settling in Great Britain. The British Election Survey (BES) started asking the public about immigration in 1964 because of increasing concern over the arrival of' New Commonwealth; however, in these early years it did not ask' vivid' respondents the issue. The majority of people in England have decided during this time that there are too many foreigners in the UK. Figure 2 explores patterns in relation to immigrants/immigration, although the varying data sources available and variations in the terminology of the questions over the years make it not to be considered as a cohesive continuum. The evidence obtained from the British Election Study (BES) shows that immigration resistance was strong in 1964, 1966 and 1979 with 85-86% of immigrants registered being too high in England at each time. There was a separate terminology for the remaining questions in the data points from 1983 and 1987 (see Notes in the chart). We must therefore be vigilant about this. Nonetheless, in 2015, the previous question repeatedly stated that the proportion of immigrants accepting the figure had fallen to 71 percent.

the vector graph represents immigration opposition data from 1964-2016;

Fig. 2 Immigration opposition data from 1964-2016; Source: https://migrationobservatory.ox.ac.uk/resources/briefings/uk-public-opinion-toward-immigration-overall-attitudes-and-level-of-concern/

One way of tracking public views on migration is to ask people to discuss the' most important question' or the' questions' facing the nation. This technique evaluates the origin of immigration as a problem instead of measuring the attitudes of people directly in relation to immigration. In a monthly poll, Ipsos MORI asks the participants to name the most important issue first and they are asked, after they answer them, to name "other important questions." In contrast to the other survey questions reported here, respondents are not motivated by specific issues. Alternatively, they only answer with anything that comes to mind. Figure 3 identifies the percentage of respondents who call race relations or immigration one of Britain's most important problems compared to other four most commonly mentioned issues. 

a grapgh representing issues vs. response chart

Fig. 3 Issues vs. response chart; Source: https://migrationobservatory.ox.ac.uk/resources/briefings/uk-public-opinion-toward-immigration-overall-attitudes-and-level-of-concern/

These other problems are shown as moving averages of six months to make the figure easier to understand. Throughout June 2015 and June 2016 the most influential issue the country encountered in the year leading up to the EU referendum was continuously referred as the act of immigration, reaching a peak of 56% in September 2015. Lower than 5 percent of respondents viewed immigration as an issue in 1994, that served as the starting point of this sequence, and it was rarely mentioned until 2000. 

Women in the South-eastern Asian region are not unfamiliar with the workforce. In the region, the Philippines ranks ninth throughout terms of gender equality, where women will participate in politics, have several seats on the board of companies, and so forth. Nevertheless, in both local and international businesses, the absence of gender diversification is still highly evident in the workforce. The ADB report says women in Asia are "on average 70,000 less likely than men to be working by workplace, according to ADB's Asian Development Bank survey. Despite economic growth, declining fertility rates and increased education this gap continues to exist. Women still have a lack of progress in the business and political sectors, even in Singapore, a developed market in Southeast Asia that boasts a female employment rate of 89%. Women in leading jobs should also demonstrate a more stable attitude, which men in return do not anticipate. these activities result in the act of receiving less compensation and, on average, reaping 10% less than people in most sectors for the same work. No doubt there are significant repercussions for the ASEAN economy due to the absence of active women's involvement in the labour force. This suggests that spending too little in qualified women decreases worker productivity that then impedes their ability to grow. 

The history of migration in Britain underlines other reasons why people are fleeing. In the 19th century, important migration to Britain began. The waves of immigration and efflux to and from Britain have marked Irish migration when people have either been indefinitely settled or briefly moving towards an eventual return to Germany. In the latter half of the 19th century, Eastern European Jews fled both religious persecution as well as hardship, with subsequent immigration both before and after the Second World War in Britain. In the 1960s, employees were hired by employers from Western Indians to fill low-paid jobs that were less desirable to local people, particularly in the urban areas. Citizens from the Indian subcontinent came to the world for educational and economic purposes, the most important of which was the migration of the West Indian. In the late 1970, Asians deported by the government of Idi Amin arrived from Uganda. In the 1980s, the immigration laws limited the number of people allowed to move to Britain was changed. People around the world are now opting to move both lawfully and unlawfully to the United Kingdom and other developed countries, to boost education and employment prospects, escape discrimination, resettle following catastrophic incidents, including violence, flood, and conflict, and/or meet family members who have moved in time to the UK. Migration may be categorized in several ways; for example, on the basis of motives for migration, social and educational practices of migrants, period of relocalisation, and geographical distribution of relocations. Therefore, the category of migrants may be differentiated according to whether they have voluntary interaction with the' base' community or the' dominant' culture. Migrants can be categorized as immigrants and residents if the change in location leads to voluntary interactions, whilst the refugees are deemed to have inadvertently changed their location. For example, in planning for the migration, immigrants choose to migrate, so that they are in the and frequent contact with "everyone" society, for possible advances in terms of economics and/or schooling, while refugees are required to migrate in order to avoid harassment by involuntarily approaching "the majority" community. Furthermore, rural/urban migration is due to economic and educational reasons for displacement, while national migration is attributed to cultural, educational, social and political factors.

Research Methodology

As mentioned in the topic of this particular section, this chapter contains the research methodology which has been implemented to carry out research and complete this dissertation. 

First of all, the section will explain the selection of the research approach, research design and the advantages as well as disadvantages of the selected research tools. It will be supported by some kind of discussion about their ability to generate valid results, meeting the goals and expectations set by this thesis. It then describes the sample size and also the sampling technique used by the researcher, as well as the methods used to analyse the data. This ends with a brief description of ethical considerations including drawbacks of this research methodology, as well as the problems of the research.

Research approach

This dissertation is based on quantitative research method, where interpretivism is the method of the research applied. Willis (2007) describes interpretivism as a method that the author uses to synthesize facts that are obtained predominantly from secondary sources and are of a quantitative nature. He also states that one significant feature of interpretivism is its abstract nature and are controlled by a number of non-tangible factors which are difficult to be quantified in terms of variables. The researcher therefore chose the interpretative approach for the carrying out this research study over other positivist and practical approaches, since theoretical, non-quantifiable variables such as discovering the arts in business and collaborating with them to create a memorable experience, contrasting conventional management with performing art management and evaluating whether performing techniques and techniques. All of these are elements that are not easy to quantify (measure) and among which distinct and sophisticated connections have been found to exist, so interpretivism has been concluded to be the most relevant one.

Research design

This research uses a quantitative research approach well into the sense that some sort of numerical data or quantitative data have been produced (Bell, 2005; Sarantakos, 2013; Silverman, 2004). For the considerations of this analysis where the relationships between several variables involved is to be established by interpretation, a quantitative research strategy is particularly applicable. The analysis also incorporates the use of triangulation as it provides an opportunity for considering the research goals from different points of view (Cohen and Manion, 2002; Altrichter et. al, 2008), thus, offering even more nuanced views of the relationship between variables involved. Triangulation was quite useful for this analysis because the author sought to find the intersection between two very different variables that belonged to very distinct fields–immigration and job industry.   Next, the relevance and the benefits and even drawbacks of the methods used to execute the analysis strategy will be discussed.

Research Method

For the purposes of this research, the writer has decided to use a combination of books, industry reports, journals, scholarly articles. These resources will be carefully analysed to fetch the most relevant data available from these sources. The overall effectiveness of quantitative research is heavily based on researcher’s ability to research, identify and fetch data from the aforementioned sources. While the findings may not be viewed as accurate because they are mostly focused on the subjective opinions and expectations of the researcher. Since smaller samples will be frequently used for analysing the data, it is also problematic for quantitative research findings to be seen as representing the views of a wider population

Because of the behavioural aspects encapsulated throughout this research, the author also considered focus groups as well as participant assessment as a possible alternative for research method. However, this research method was not chosen due to time and budget constraints.

Data sampling

For the purposes of this study, the writer had to examine two separate groups of participants. A method of stratified sampling has been used, as the relationships between different sub-groups had to be observed (Kirby et. al, 2000: 339). Furthermore, a particular group of the total population was invited to the interviews, forming a sub-group of the original population. Also, the participants were selected on the basis of specific criteria, such as company (organisation), where a particular type of model has been implemented.

The first group of participants consisted of managers from companies where the performance arts approached has been used. A total of 10 managers were involved in the study, and over 50 different managers from five different companies across the UK were contacted in order to reach the target group. The author tried to create as diverse a sample as possible, making sure there was an equal number of men and women represented, and more importantly thatthere were representatives of various industries: advertisingretail, finance, fashion and digital marketing. The other group of participants consisted of 30 employees, who were part of the teams of each one of the 10 managers. Not every team had the exact same number of people, as some teams were smaller and others larger. . However, the size of the teams was irrelevant to the purposes of this study as the participants had to complete individual questionnaires. All of the participants were approached via email, and the questionnaires were distributed via email, then completed by the participant and returned via email again. This took place in the course of four weeks. Five of the managers and five of the employees were invited for an interview, they were randomly selected from the questionnaire sample and the interviews took place took place over the phone/Skype and recorded then transcribed by the researcher. The interviews took place in the course of one month. The full transcripts of the interviews as well as the questionnaires are attached in the appendices.

References

Afonso, A., & Devitt, C. (2017). If the UK wants to cut immigration, it must change its model of capitalism. LSE Brexit.

Browne, J., & Hood, A. (2016). Living standards, poverty and inequality in the UK: 2015-2016 to 2020-2021 (No. R114). IFS Report.

Jenkins, S. P. (2016). The Income Distribution in the UK. Social Advantage and Disadvantage, ed. by H. Dean, and L. Platt, 135-160.

Lahiri, S. (2017). South Asians in post-imperial Britain: decolonisation and imperial legacy. In British culture and the end of empire. Manchester University Press.

Ottaviano, G. I., Peri, G., & Wright, G. C. (2018). Immigration, trade and productivity in services: Evidence from UK firms. Journal of International Economics, 112, 88-108.

Vargas-Silva, C., Markaki, Y., & Sumption, M. (2016). The impacts of international migration on poverty in the UK. Joseph Rowntree Foundation.

Vivarelli, M. (2015). Innovation and employment. IZA World of Labor.

Wadsworth, J., Dhingra, S., Ottaviano, G., & Van Reenen, J. (2016). Brexit and the Impact of Immigration on the UK. Centre for Economic Performance. LSE, 34-53.

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