Glance at the newspapers this morning and you will quickly gather that academics at University College London have published a new study on how much immigrants contribute to the economy.
But you might be confused about whether the news is good or bad. Migration Watch responded to the report by saying: “Immigration as a whole has cost up to £150 billion in the last 17 years.”
Other commentators have focused on a positive fiscal contribution apparently made by migrants from other EU countries. Confused? Never fear – FactCheck is here.
What’s new today?
Researchers from UCL’s Centre for Research and Analysis of Migration (CReAM) – probably the leading experts in this field – have tried to tot up how much migrants paid in and took out of the UK economy between 1995 and 2011.
They look at tax paid by immigrants versus their uptake of benefits, tax credits, social housing, education, health and police services.
If we start counting in 1995, we find that migrants from the EEA (that’s EU countries plus Iceland, Liechtenstein and Norway) make a small net positive contribution. They pay in a few billion pounds more than they take out.
For immigrants from outside Europe and native-born Britons, it’s the opposite. Non-Europeans have a negative effect – worth in the region of £100bn. Natives are also net “takers”, to the tune of about £600bn.
The numbers change if we make different accounting assumptions (p49) but the pattern is the same.
But if we start counting from 2001, the contribution made by migrants rises considerably.
The central estimates used in the paper suggest European immigrants make a net contribution of around £20bn. For immigrants from outside Europe there is a small net contribution of around £5bn and for natives the net cost was more than £616bn.
The big take-home messages are that: a) the big wave of immigration from central and Eastern Europe after 2004 was good for the UK economy and b) native-born Britons are a bigger drain on the state than immigrants.
One important point: the researchers say that all their figures are likely to under-estimate the long-term economic contribution made by immigrants, because it’s impossible to track what happens to their children.
British-born descendants of immigrants tend to do better at school and may well go on to make a higher net contribution to the economy than natives.
Is this a surprise?
No. The new paper is in fact an updated version of research CReAM put out in November last year, with very similar conclusions.
Last year the research attracted little attention, but today, with EU migration much higher on the news agenda, it is being splashed across the headlines.
As we have found in previous FactChecks, evidence from the OECD, the Department of Work and Pensions, the Office for Budget Responsibility and the European Commission also supports the view that EU migrants are likely to be net contributors to the UK economy.
Where do European immigrants live?
Click here for our handy interactive map of where EU migrants live. Migrants from Europe have tended to settle in London and a handful of other places in England.
Anecdotally, local people have felt pressure on housing, jobs and local services from very high levels of recent migration.
But we’ve found that nationally, the impact of migration on unemployment and housing has been surprisingly small.
We have also found that Ukip, who say EU immigration to Britain is unacceptably high, are targeting areas of the country where there are fewer European migrants than average.
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