Are migrants making the UK economy richer or poorer?

Do migrants help pop more coins into British piggy banks, or are they burning a hole in the UK pocket?


There are more than 7 million foreign-born people living in the UK and that’s about the same number of people that were living in England and Wales in the 1700s. Overall, this makes up about 13% of the people living and working in the general population. Almost 17% of all full-time jobs in the UK are held by immigrants. Most of these jobs are low-skilled jobs like cleaning, or factory work, which are very important for the country's economy. A whopping 34% of the people who make clothes in the UK are immigrants too - without them, there would be fewer people to make clothes, which would probably make them more expensive to buy. 

The economic positives

Gaining the support of foreign-born workers means the UK has greater ability to sell and export locally-made products. This is valuable to the economy and enables the country to spend on national services and defence. 

Many people who migrate to the UK are fairly young, so they help provide support as young carers to look after the country's ageing population. Also, it’s important to remember that foreign students pay more for their university courses when they study in the UK than their British peers. This means that universities have about £2.5 billion more per year to spend on education and developing the services they offer. 

But not all foreign-born workers have low-skilled jobs. There are a lot of highly educated migrants who work in the UK as doctors, business people, or academics. Educated migrants are particularly beneficial to the UK economy because they contribute a lot in tax, they help UK businesses grow, and therefore help fund public services in the UK.

Overall, the UK profits from migrant workers, whether they are highly educated or not. In fact, a study by The Independent online newspaper showed that migrant workers from Poland and other recent EU members have contributed £5 billion more to the UK economy than they've taken out in benefits or health care!

The economic negatives

If significant numbers of migrants move to the UK, this increases the demand for goods and services. Some economists argue that living costs and housing prices are rising due to this increased demand and that this would be lower if there was no migration to the UK. But it is very difficult to determine whether migration is the only reason, or even the main reason, for why living costs and housing prices are rising. A recent study by the LSE and the UK Migration Advisory Committee states, for example, that overall "rents have been largely unaffected as some [immigrants] have crowded into existing properties and rented poor quality housing shunned by the local population." In sum, this point is subject to a lot of debate among experts.

But there are other potential economic negatives, and those ones seem a bit more clear-cut: for example, any migrants who are working legally also pay income tax and VAT, which the UK government spends on services for everyone in the country to use. But not all immigrants do pay taxes, and some remain unknown to the authorities and could contribute to the underground economy which can cost a lot of the money for the police to resolve.

Also, public services like the NHS may be stretched thin because there are more people that need them. If our benefits and healthcare are used by foreign-born people, there’s less money to spend on citizens and we’ll all then receive lower quality public services. There are also some migrants who come to England just to receive free health care (they’re known as ‘health tourists’) and these people, along with British people who abuse the NHS, may cost us up to £300 million a year. So while there are many immigrants who contribute to the NHS by working as doctors and nurses in the UK, or simply by paying taxes, we have to take the worry seriously that there may be some people who are only benefitting from the NHS without contributing anything.

The Oxford University Migration Observatory says that research in this area often gives us varied results, because each researcher may be focussing on different groups, or they may be looking for different factors at different points in time. Therefore, there is so far no clear way of knowing exactly whether immigrants are contributing more to the UK economy than they take out. What do you think?