Migrants boost economy?????? but worry voters
By Simon Rabinovitch Reuters - Wednesday, April 25LONDON (Reuters) -
Britons' concern over an influx of Eastern European immigrants is a mounting theme in the run-up to local elections in May, even as some argue people are overlooking the economic benefits immigration has brought.
Immigration Minister Liam Byrne wrote last week that the country has been "deeply unsettled" by the more than half million east Europeans, largely from Poland, who have arrived over the past three years.
82 percent of 2,254 Britons questioned in a recent YouGov poll said the government does not have immigration under control. Only 31 percent said immigrants were good for the national economy.
Their views are reflected in newspapers publishing a steady flow of articles calling for tighter restrictions.
"We must regain control of our borders -- now," read a recent opinion column in the Daily Telegraph. "Immigrant baby boom: NHS under strain from east Europeans," was a headline last month in the Daily Mail.
However, economists say the immigrants have added billions of pounds to national wealth and kept inflation in check. And employers are not complaining.
Homeowners have benefited from largely inflation-free growth, in the form of low interest rates, they say.
Stephen Boyle, an economist at the Royal Bank of Scotland, in January titled a research note: "Polish plumbers: mending your pipes and keeping your mortgage down."
MORE SKILLS, HARD WORKERS
Nearly 600,000 eastern Europeans have come to work in Britain since their countries joined the European Union in 2004, according to the Home Office. This dwarfs the 15,000 arrivals the government expected each year.
"They've got a far better work ethic, young Poles, than a lot of the local British people. And they have much higher skill levels," said David Frost, director general of the British Chambers of Commerce, which represents small businesses, many family-owned.
Frost said the employers he speaks to never cite low wages as the main reason for hiring eastern Europeans, although that point may be moot.
Lord Turner, former chairman of the Low Pay Commission, a body advising the government on the minimum wage, reportedly warned Prime Minister Tony Blair last month that immigrants were pushing down wages among low-paid workers and spurring unemployment for the unskilled.
Speaking a short time later, Blair said migrant workers had made the labour market "intensely competitive", though that was as far as he was willing to go.
Economists say there are signs migrants are paid less than British-born workers doing similar jobs -- but they see no evidence of migrants causing any increase in unemployment among British workers.
Focusing on pay may also miss the bigger picture.
"What migration has done to date is to add to labour supply in the UK in terms of both quantity and quality," said the Royal Bank of Scotland's Boyle.
"That's expanding the supply capacity of the economy, thereby allowing it to grow more quickly than it otherwise would be able to do."
The government calculates an expanding labour force means the economy can grow faster without fuelling inflation. It now reckons the economy can grow by 2.75 percent a year without sparking upward price pressures, up from a previous estimate of 2.5 percent.
This could translate into an extra 16 billion pounds of wealth over the next five years.
HARDENING ATTITUDES
But this is a tough sell to the general public.
The benefits of fast growth and low interest rates are dispersed throughout the population, but the cost to any British-born workers who have seen their pay stagnate are much more concentrated.
Public attitudes to immigration are hardening.
The YouGov poll in January showed that 63 percent of Britons strongly agreed there should be limits to the number of immigrants allowed in each year: up from half of respondents 10 months earlier.
Such discontent is potentially fruitful for the British National Party. The far-right party with an anti-immigrant message is fielding a record 827 candidates in the May 3 local elections, more than double its roster last year.
Although the BNP is still a fringe actor in British politics, the mainstream is also raising questions.
Immigration minister Byrne wrote: "It's not racist for (the governing Labour Party) to debate immigration; it's the real world -- the world in which the people we represent live."
The government is planning a points system to manage migration from non-EU countries. Limits were placed on the number of workers allowed in from new EU members Romania and Bulgaria -- a shift from the open-door policy for Poland and other east European nations in 2004.
And even the businesses that welcome migrant workers worry that dependence on imported skills might mean Britain neglects the skill levels of its own children.
"Is this really going to be a recipe for a successful future?" asked BCC's Frost.
But in the meantime, eastern Europeans streaming in still find themselves in high demand.
"Polish people come here and work really hard," said Andrzej Kowalski, a 33-year-old Pole who cleans windows in London.
"And I think we've got a good name here."
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