From the TUC

Immigration policy isn’t just about immigration

23 Jun 2012, by in Labour market

Ed Miliband’s speech about immigration on Friday was much trailed and much commented on, but I suspect it was little read. So I’ll try to concentrate on what he actually said rather than what everyone thinks he meant by it. It’s one of the hazards of immigration policy: all too often, people search for hidden meanings rather than concentrate on the actual proposals being made.

One of the other odd features of immigration policy is that a lot of the time what affects actual immigration and actual immigrants isn’t immigration policy at all. Miliband’s speech was mostly – and he was explicit about this – about labour market policy, and the implications that would have for immigration.

So, on the substance, the speech marks an acceptance of a key union demand: stronger regulation of the labour market, especially to protect the vulnerable and the low paid. There is still more to say (again, as he was at pains to stress) over issues like housing policy, but on the labour market, this speech was a positive move.

The TUC has long held the view that our main approach to immigration should focus on working people. We believe that preventing exploitation of migrant workers and undercutting of the existing workforce is the best way to prevent one section of workers being pitted against another – as happened at the Lindsey oil refinery.

What Ed said about the regulation of the labour market was this:

“To have an effective immigration policy, we must also reform how our economy works so that it works for all working people in Britain, whoever they are and wherever they come from. That means tougher labour standards to do more to protect working people from their wages and conditions being undermined.”

That, together with his admission that Labour had been “too dazzled by globalisation”, seems to me to be a key policy development for Labour, and one that trade unions should welcome. Of course, there is much more work to be done to flesh out the policies needed to turn it into practice, and we would have wanted to see more about a Living Wage. But the suggestion that fines for breaching the minimum wage should at least double is welcome, as is the probably more important suggestion that local authorities as well as HMRC should be given enforcement powers.

One issue which led to questions at the end of his speech, and much comment online, was the impact on wages he ascribed to migration. What he actually said was that “the combination of immigration and an under-regulated labour market held wages down in hospitality, food processing and social care,” ie at the lower end of the labour market. What several people thought he said was that immigration cost jobs and held down wages overall. Much energy was therefore devoted in the blogosphere to proving that wages had not been reduced and the ‘lump of labour fallacy’ was also deployed.

Actually it’s a bit difficult to determine what overall wage levels would have been if there hadn’t been mass migration since 2000, and it is certainly true that, at least for the first half of the decade, real wages in the UK rose. However, the fact that we had a booming economy and a relatively tight domestic labour market might have led to higher rates of wage growth without mass migration loosening that labour market (as the Bank of England said at the time.) The point Ed was making, though, was that wages at the bottom end of the labour market, while underpinned by the national minimum wage which prevented the much worse undercutting that happened in Germany, were held down by competition for low paid, low skilled jobs, and that certainly does seem to have been the pattern in at least the second half of the decade.

As to other policies, we would certainly welcome a commitment to building more social housing, and improving public services, so that there is less concern about the rationing that seems to have produced most concern in certain areas of the country. We would like to see much more about education and training policies designed to prevent the skill shortages to which migration is often the solution (with potentially harmful impacts on sending nations as well as receivers.) And we have long argued that better policies for integration such as greater access to English as a second language training would be valuable.

We welcome Miliband’s scepticism about the coalition’s artificial caps on immigration numbers, but we would also be wary of some of his own prescriptions, for example about using transitional measures to deal with the possible accession of new members of the EU (not least because they force migrant workers into bogus self-employment without necessarily reducing overall numbers).

But overall, the speech sets out a new direction for policy on immigration, rooted in real experiences rather than rash generalisations or pandering to prejudice.