UK needs immigration to keep service industries going, says ONS

Immigration is particularly important to keep Britain’s health service and its wholesale and retail, public administration and hospitality trades going, with more than 1.5 million migrants working in these sectors, according to a new official analysis.

The Office for National Statistics analysis also shows that migrants from eastern Europe are likely to work more hours and earn lower wages than other workers, partly reflecting their numbers in lower skilled jobs. They are also likely to be over-educated for the jobs they do.

But they also show that migrants from western European countries are more likely to have a university degree, to be higher paid and to work in a job that matches their education.

This split in profile between western and eastern European migrants working in Britain is echoed by their relative concentrations in the financial and business service sectors on the one hand and agriculture and manufacturing on the other. It also carries serious implications for ministers attempting to devise a post-Brexit immigration policy from Europe.

It is also reflected in average wage levels. Those from western European EU countries, such as France and Germany, earn more – £12.59 an hour on average – than UK national average earnings of £11.30 an hour, while those from eastern Europe earn on average £8.33 an hour. East Europeans also work harder with 61% completing more than 40 a hours a week compared to only 32% of UK nationals.

The difference in average wages may be accounted for by the difference in educational background. More than half the western European migrants in the British labour force – 488,000 out of 863,000 – have degrees, compared to only 242,000 of 822,000 east Europeans.

The ONS analysis, the first of a series on international immigration and the labour market, shows that 3.4 million migrants work in Britain, making up 11% of the 30.3-million-strong workforce. EU nationals account for 2.2 million or 7%, while those from outside Europe account for 1.2 million or 4%.

The statisticians say there are higher proportions of international migrants in some industry sectors than others, and they make up 14% of the workforce in the wholesale and retail trade and in hotels and restaurants. More than 508,000 EU nationals work in these sectors.

They are also particularly important to financial and business services where they make up 12% of the workforce and include 382,000 EU nationals.

Migrants are also essential to keep the public sector going with 701,000 non-UK nationals working in public administration, education and health sectors. More than a quarter of migrants work in the public sector.

The non-UK workforce is almost evenly split between those who work in professional occupations – 658,000 – and those in “elementary” occupations such as selling goods, cleaning or freight handling – 669,000.

The ONS analysis shows foreign workers are more likely to be in jobs they are overqualified for than UK nationals. About 15% of UK nationals were employed in jobs they were deemed to be over-educated for compared with almost two in five non-UK nationals.

The statisticians say one explanation for the proportion classed as over-educated is that they may have sought employment in the UK to do lower-skilled jobs in order to experience life in the UK and gain other experiences, such as learning English, rather than as a career move.

Anna Bodey, migration analyst for the Office for National Statistics, said: “Today’s analysis shows the significant impact international migration has on the UK labour market. It is particularly important to the wholesale and retail, hospitality, and public administration and health sectors, which employ around 1.5 million non-UK nationals.

“Migrants from eastern Europe, Bulgaria and Romania are likely to work more hours and earn lower wages than other workers, partly reflecting their numbers in lower-skilled jobs. Many EU migrants are also more likely to be over-educated for the jobs they are in.”

A “setting the scene” note introducing the analysis says that while the number of EU nationals living in Britain increased by 1.3 million between 2011 and 2016, the proportion of UK nationals in Britain remained at around 91% because their numbers also increased by 1.5 million over the same period. EU nationals make up 5% of the 64 million UK population, with 2.4 million migrants from outside Europe the other 4%.