The debate on immigration in Britain puts GDP ahead of people

When I arrived in the Home Office with Theresa May as her adviser in 2010, we discovered that official impact assessments – the Government’s process of weighing up the pros and cons of policy – had long been skewed in favour of higher immigration. Because a larger population meant a larger economy, and the assessments assumed that was what Britain needed, they failed to consider the economic effects of immigration on a per-person basis. And they excluded costs like the impact on existing workers’ wages, infrastructure, and public services.

When we commissioned the Migration Advisory Committee to review these assessments, their findings surprised even us. Examining non-European immigration between 1995 and 2010, they found that for every 100 foreign-born workers employed, 23 British workers had been displaced from the labour market. The response to the report was typical of the immigration debate. Advocates of lower immigration pounced on the findings with enthusiasm. Supporters of higher immigration denigrated the report and pointed to other evidence that suited their views.

I do not pretend to know whether all immigration, added together, always displaces local workers or reduces wages. Immigrants vary from brain surgeons to semi-literate octogenarian grandmothers. They come during boom years, recessions and everything in between. And they join an already complex labour market comprising millions of people.

After reading numerous academic analyses, my conclusion is that mass immigration makes little economic difference overall. It might increase GDP, but on a per-person basis its effect is probably neutral. The OECD thinks it has close to zero fiscal effect. While there is no “lump of labour” – no fixed number of jobs in the economy – it can force some people out of work. And it can, sometimes, push down wages for low-paid workers.

In truth, the research confirms what most of us feel intuitively about mass immigration. Those of us earning high salaries benefit – in the form of cheaper plumbers and waiters in nice restaurants – but our fellow citizens with lower wages can lose out.

This is not an argument for zero immigration. Highly skilled immigrants can drive innovation and economic growth. Selective immigration can fill skills gaps. The diversity of our cities, especially London, is an intangible benefit that contributes to their dynamism and appeal. And, increasingly, families have friends and loved ones who came to Britain as migrants or whose parents or grandparents did.

But immigration needs to be controlled, because when it is not it can cause problems. The pressure it puts on the NHS might be offset by tax revenues produced by migrants, and foreign workers certainly keep the health service going. But immigration is behind more than a third of new demand for housing in England, making homes harder to come by and increasing housing costs.

Immigration and high birth rates among migrant mothers are also driving the soaring demand for school places. There are 577,000 more pupils in English schools compared to 2009, and more than 650,000 new places will be needed by 2026. That is why Government is struggling to increase per-pupil funding in real terms.

As any young family knows, these costs are real. Yet they are never factored into the Government’s impact assessments. Neither are the social reasons for controlling immigration taken into account. Perhaps this is because the very topic turns many politicians squeamish, but most members of the public see no reason for embarrassment.

This is because people value the communities they live in, and they do not want them to change rapidly, if indeed they want them to change at all. And they value the solidarity made possible by national identity and common norms.

There is nothing shameful about this. It is innate to human nature that we will do things for our compatriots that we would not do for foreigners, just as we will do things for relatives that we would not do for strangers. This solidarity is what causes us to risk our lives for one another during wartime, or pay taxes to fund services for others at times of peace.

In Britain, national identity and citizenship are civic, not ethnic. There is no national, racial or religious background that prevents somebody from making a life here and becoming British. Newcomers, however, need to adopt our common laws, rules, norms and institutions: the things that make us British. Fortunately, most migrants want to do so. They want to contribute and become full and active members of our society. But the arrival of large numbers from vastly different cultures can make that harder to achieve.

This is not an argument against immigration from different cultures. But if we are to absorb immigration in a way that maintains the values of our country – and the solidarity made possible by national identity and citizenship – then immigration needs to be controlled, and lower.