Memorandum by the Commission for Rural
Communities
RURAL CONTEXT
SUMMARY
1. Nine and a half million people, one in
five of the overall population, live in rural England. The rural
population is growing and is projected to grow at a faster rate
than England's urban population. In part, this rural population
growth is driven by high levels of (within-UK) urban to rural
migration. Up until recently levels of international in-migration
to rural areas have been relatively low. However the recent immigration
from A8 countries has demonstrated that there is a stronger likelihood
of these migrants working and or settling in rural areas.
2. As a result of natural population changes
and of migration, rural areas now have a higher proportion of
older people than is found in urban England and a lower proportion
of younger people (eg those within the 15-29 age group).
3. By many measures, the economies of much
of rural England are performing well. Rural districts host at
least 30% of the country's businesses. Annual turnover of rural
firms has increased by 10% in five years to over £320 billion.
The impact on economies
4. Gaining economic advantage is one of
the key stimulants for migration, both for the migrant worker,
and also for the hosting country that is seeking to fill labour
shortages and skills gaps.
5. The Institute for Public Policy Research's
(IPPR) "Paying Their Way" study in 2005 found that the
per capita revenue to the Government generated by immigrants in
2003-04 was (at £7,203) higher than that for the UK born
(£6,861). The study went on to show that government expenditure
per capita on immigrants was lower (£7,277) than for the
UK born (£7,753).
6. Treasury studies suggest that around
15% of UK trend growth depends on inward migration, and that while
foreign-born migrants make up 8% of the population, they generate
10% of our Gross Domestic Product.
7. Migrants also produce indirect
fiscal effects, for example, by introducing new industries and/or
increasing the productivity of existing labour and capital, thereby
stimulating the level and growth rate of production.
8. From this initial analysis, there is
some evidence that:
— The scale of arriving migrant workers
is similar in rural areas to that in urban areas and, as in urban
areas, numbers of arrivals are continuing to rise.
— The arrival pattern of migrant workers
in rural areas is more seasonal than in urban areas.
— Rural migrant workers are geographically
concentrated in specific areas—such as Lincolnshire, the
Wash, Yorkshire and Herefordshire.
— This geographical concentration is
related to the greater concentration of new arrivals in specific
sectors—manufacturing, distribution and agriculture.
— In these rural areas migrant workers
can also be a significant proportion of the overall workforce.
9. We have suggested that Defra consider
the remit of the Gangmasters' Licensing Authority. At present
its operations are limited largely to agriculture. Yet gangmasters
also supply labour to other significant industries in rural (and
other) areas, such as tourism and hospitality, care homes and
hospitals.
10. We have also suggested that the role
of some potentially unscrupulous recruitment companies be scrutinised
and if necessary regulated.
What are the numbers and characteristics of recent
immigrants—age, gender, country of origin, immigration status,
duration of stay, skills and qualifications?
11. Our analysis is based on information
collected via the Workers' Registration Scheme. These registrations
are grouped according to the workplace of the individual. Analysis
has also been undertaken of those registrations for National Insurance
numbers made by all non-UK nationals. It is important to note
that there are a number of different data sources used to report
on migrant workers, that they are all far from perfect and that
official statistics on this topic are under review.
12. According to the available information
from the WRS, around 120,000 migrant workers registered in the
rural areas of England between May 2004 and September 2006. This
represents 23% of the total number of WRS registrations across
England as a whole over this period.
13. To put this figure into perspective,
the total number of rural WRS registrations over the 29-month
period is equivalent to around 170 for every 10,000 people of
working age—a figure in line with the overall English figure.
14. The information on National Insurance
Number registrations made by non-UK nationals suggests a lower
rural proportion of the overall English total. This may be related
to the different approaches used. The National Insurance information
relates to an individual's place of residence. Consequently people
who live in urban areas but who work in rural areas would not
be included in these statistics.
How do the characteristics of EU migrants differ
from other migrant groups?
15. European migrants are more likely to
work and settle in rural areas than previous waves of immigrants
from for example the Indian sub continent.
What are the expected future trends for immigration
from within and outside the EU?
16. September is the peak registration month
in each year to date. This strong seasonal pattern is less pronounced
in the equivalent registration data for urban areas.
17. Over the period for which we have data
there is a clear year on year increase in the number of people
registering on the WRS in rural areas, although the rate of increase
is slowing. A similar rate of increase has been seen in urban
areas.
18. The data on National Insurance registrations
suggests that, if anything, the rate of increase is greater in
rural areas than in urban.
2. In what sectors and occupations are immigrants
employed?
19. The WRS data can also identify the key
economic sectors within which the rural A8 Migrant workers were
employed between May 2004 and September 2006. In terms of absolute
numbers, there are three key sectors:
— Manufacturing (33% of all rural registrations).
— Agriculture and fishing (25% of all
rural registrations).
— Distribution, hotel and retail (20%
of all rural registrations).
20. These three sectors take on over three
quarters of registrations in rural areas. In comparison the same
three sectors account for 36% of overall rural employment. Clearly,
migrant workers are more concentrated in specific industries than
is the case for rural employees as a whole.
21. In comparison to the overall local workforce
in rural areas, we can see that migrant workers are highly "over-represented"
in both manufacturing (which includes businesses such as food
processing and pack-houses) and in agriculture/fishing, while
they are highly "under-represented" in sectors such
as public administration, education and health and banking, finance
and insurance.
22. This more concentrated pattern of employment
for A8 workers is also seen in urban areas however there are some
differences in the specific sectors.
How do migrants' labour market outcomes—including
their employment rates and earnings—compare to those of
local workers?
23. Many migrant workers recognise that
the jobs they take are often arduous, relatively poorly paid and
often do not utilise their skills to the full extent. However,
jobs that are considered to pay little in the UK are relatively
well paid compared with their home countries.
What determines migrants' performance and integration
in the UK labour market?
24. Learning and speaking English are key
elements, as are being aware of employment rights and UK customs
and protocols. Migrants come to the UK to gain experience of living
abroad and gaining wider experience as well as to earn money.
25. There is a wide range of attitude on
the part of projects to help employers as to how much they should
do to help migrants integrate. It should be self evident that
if an employer takes the trouble to help their workers integrate
there is a good chance that they will perform better in the workplace.
26. Some voluntary bodies are now employing
migrants as part of projects to help migrants integrate. Such
initiatives should be supported and encouraged.
27. Other support agencies such as RDA's
and Business Links and local authorities are now feeling the pressure
to provide services, however in most cases there is a lag between
what is being demanded and the funds to support the growing demand.
3. Why do employers want to hire immigrants?
28. Migrants from Eastern Europe are noted
for their willingness to work hard for relatively little reward.
Many employers also consider that young people from the UK are
often not adequately equipped or experienced to do even relatively
low skill level work and may have an "attitude problem"'.
Therefore a relatively skilled hard working and willing migrant
is an attractive proposition for many employers even though communication
can be an issue.
In short migrants work hard and are relatively
inexpensive to employ.
Which sectors and occupations in the UK economy
are particularly dependent on migrant labour and why?
29. At this relatively early stage in migration
effects from A8 migrants it seems apparent that in rural areas
relatively low skilled jobs are those that are available to them.
However over time as migrants improve their language skills and
become more accustomed to UK protocols and customs it is possible
that they will move up the employment skills hierarchy and get
higher paid more demanding and rewarding work.
30. Some rural economies would become vulnerable
to "a big hit" should there be a sudden reversal in
the influx of migrant workers from the A8 countries, with immediate
and potentially damaging consequences to businesses suddenly faced
with shortages of labour and higher labour costs. This might be
of particular concern to the manufacturing, distribution and agriculture
sectors. This type of situation was recently reported in connection
with the lack of availability of strawberries due to lack of migrant
labour to pick them. The effects of recent flooding on the rural
economy may make the need for migrant labour to rebuild and support
shattered communities even more critical. It may be that also
as a result of flooding and disruption migrant workers may choose
to work elsewhere in Europe or return home.
What is the impact of immigration on mechanisation
and investment in technical change?
No comment
What are the alternatives to immigration to reduce
labour shortages?
31. This issue to some extent is being addressed
through the Governments Welfare Reform Programme.
32. Young people should be supported to
gain the skills required to function well in a workplace. This
includes skills for life such as team working, co-operation, responsibility,
initiative as well as the technical or trade skills required.
They will then be better equipped to compete for jobs and fill
labour shortages.
33. Older workers should be encouraged to
retrain if necessary or utilise their acquired skills and experience
in different roles to fill gaps in the local economy, or even
mentor younger people to help them take up work.
4. What impact has immigration had on the
labour market, including wages, unemployment and other employment
conditions of the UK workforce, and has it differed for skilled
and unskilled employees?
34. It is highly likely that in rural areas
the jobs that would have in the past been attractive to both low
skilled workers and young inexperienced workers are now being
taken by migrants from abroad. This may have the effect of maintaining
wage levels at or even below the national minimum wage and reducing
the potential for indigenous workers to gain basic employment,
skills and the potential to progress. But we are not yet aware
of any hard evidence on this issue. The impact of migrant workers
on skilled trades such as construction has been well documented
given the relative lack of local trades skills available in some
parts of the UK. However with other sectors such as clerical and
managerial at this stage it appears have not been affected as
a result of migrants.
How does the minimum wage affect the impact of
immigration?
35. In any further work by the Low Pay Commission
into the operation of the National Minimum Wage we urge that attention
is paid to any rural aspects of the labour market and minimum
wage levels.
36. Migrants working legally are eligible
for the national minimum wage and therefore have some degree of
certainty about what rewards they can expect for their labour.
This may make the UK a more attractive opportunity than other
EU member states that do not have a minimum wage structure in
place.
5. What is the economic impact of illegal
immigration, including on employment, wages and the fiscal balance?
37. Basic laws of supply and demand would
suggest that any illegal immigrants working in the UK will tend
to suppress wages for some types of work. The fact that illegal
immigrants will be likely prepared to work in poor conditions
without safeguards and on low pay means that unscrupulous employers,
gangmasters and others may seek to exploit the situation.
38. Jobs that would have been available
to indigenous low skilled workers will possibly therefore become
scarce for those working within a legal framework compounding
problems of low skills and poverty.
6. What is the economic impact of a net change
in the UK population?
No comment.
If there is a net increase, does the impact differ
when this comes from higher immigration rather than from changes
in birth and death rates?
No comment
7. What has been the impact of immigration
on key macroeconomic indicators: GDP and GDP per head, unemployment,
productivity, investment, inflation and asset prices especially
housing?
No comment.
Do the economic effects of immigration vary over
time?
No comment
8. How does immigration affect the public
finances?
39. It is apparent that there is a lag between
the settlement that local authorities receive from Central Government
and the increasing costs associated with providing a whole range
of public services. This was most recently raised by The Chief
Constable of Cambridgeshire reporting the extra costs associated
with policing a significant and increasing migrant community.
Do immigrants contribute more in taxes than they
use in public services?
40. The Institute for Public Policy Research's
(IPPR) "Paying their way" study in 2005 found that the
per capita revenue to the Government generated by immigrants in
2003-04 was (at £7,203) higher than that for the UK born
(£6,861). The study went on to show that government expenditure
per capita on immigrants was lower (£7,277) than for the
UK born (£7,753).
As the UK population ages, does immigration affect
the shortfall in pension funding?
No comment
9. How has immigration affected public services
such as health care, education and social housing?
41. The CRC fully recognises the big economic
benefit that migrant workers from the A8 countries have brought
to rural England. However, there are concerns about the effects
this migration is having on already over-stretched public services
in rural areas. Unlike many urban areas rural public service providers
have little experience of dealing with such a large influx of
people and some may be struggling to cope.
42. The funding agreement for rural local
authorities is still based on the very outdated 2001 census figures
and needs to be urgently reviewed. It is now up to central government,
local authorities, businesses and voluntary service providers
to work together to ensure that migrant workers are fully integrated
into rural areas and that there is proper funding of services
in place to serve these new enlarged communities.
43. It is widely accepted that the Office
for National Statistics (ONS) mid-year estimates (on which many
resource allocation decisions are based) significantly understate
the number of migrants within different district areas This means
that public service providers do not receive the necessary support
from central Government to cover the costs of service adjustments
and provision needed.
44. Tax revenues coming from migrant workers
are generally accruing to central government, rather than to local
government (through income tax, national insurance contributions,
VAT and also through corporation tax).
45. We strongly urge central government
to review and adjust resource allocations supporting locally delivered
public services to reflect the cost pressures being faced. This
should follow on from reforms that the ONS is currently researching
and implementing in its collection of population estimates
46. Until such a review is completed, the
Government should firstly `top up', on a temporary basis, existing
budgets allocated to service providers and secondly, it should
then `top slice' these budgets to create a temporary and adequate
fund. This fund should be used to help support local services
in the localities most affected. This will require consultation
with the Local Government Association and other interests to determine
the size and management of such a fund. A similar recommendation
has just been made by the Institute for Community Cohesion in
a reporet for the Local Government Association.
Housing
47. Much the same migrant worker housing
issues apply in both urban and rural areas. However, in rural
areas caravans, caravan sites and converted farm buildings are
also being used to house migrant workers, particularly those working
in seasonal agricultural work. Poorly managed and unlicensed sites
can lead to health and safety breaches and, on occasion, are seen
as an "eye-sore" on the landscape.
48. In some rural areas migrant workers
are housed in urban areas and are "bussed" Into rural
areas for work and there may be issues around health and safety
concerning the drivers and vehicles used and possibly overcrowding.
Services
49. Those rural areas with clusters of migrant
workers can face some significant public Service challenges. Local
authorities, and their partners, in these areas can have capacity
Challenges (compared to larger and better resourced urban authorities),
as well as issues around the knowledge and skills they need to
respond effectively. There may also be a lack of resources. For
example rural schools may be faced with children where English
is not their first language, and since this will sometimes be
the first time they have encountered this, they will need additional
resources in order to respond effectively. Similarly, there may
be challenges in the provision and funding of English for Speakers
of Other Languages (ESOL) courses in rural areas.
10. How has this varied across the country?
50. Clearly areas where migrant populations
tend to work and settle will be affected more than those that
are less attractive to them. In terms of rural areas at the moment
areas that have significant land based industry and relatively
inexpensive housing tend to be those that have the largest populations
of migrants. From our research these include the Fens, Lincolnshire,
Norfolk, Herefordshire, parts of Cumbria, parts of the West Country
and the Vale of Evesham. These areas often have little historical
experience of dealing with influxes of migrants may not have the
capacity to service the needs of growing immigrant populations.
51. In some specific rural areas (such as
Herefordshire, Lincolnshire and Cambridgeshire, as well as other
areas around Somerset and Devon) there is a high concentration
of migrant workers arriving in proportion to the local labour
force. This is higher than in most urban areas.
52. Rural areas have seen little recent
in-migration compared to urban areas. In those rural areas where
there are significant numbers of migrant workers, there may be
some tensions between the settled and new arrivals in communities.
There may also be some inter-generational issues and tensions
arising in those areas where the older indigenous community
is faced by an influx of younger in-migrants.
53. In strategic terms, the focus of attention
and action should be towards achieving better And safer communities
for everyone, rather than treating migrant workers who live in
rural areas as a "problem" or "issue" that
needs to be "solved". Local authorities and their Partners
in local strategic partnerships have an important role to play
in meeting the needs of new arrivals (either short-term or long-term
stays) and in addressing the local tensions that population change
may sometimes bring.
11. Are there any relevant parallels and lessons
for the UK from the economic impact of immigration on other OECD
countries?
No comment
12. How do differences in migrants' skills
affect the economic impact of immigration?
54. As previously mentioned those on the
margins of employability such as young unskilled, older unskilled,
those with disabilities, people with caring responsibilities,
seem to be more effected in terms of employment opportunities
available to them by the influx of migrants. Over time as migrants
are able to bring in to play their full range of skills and become
more accustomed to working in the UK it is possible that higher
level jobs will become affected by those who have chosen to settle
in the UK. Subsequent waves of migrants from countries such as
Bulgaria and Romania (whilst numbers will be limited) are likely
to then take up the low skilled jobs that remain.
Does immigration fill skill gaps?
55. Migrant labour is seeking to fill labour
shortages and skills gap. Some employers believe that UK businesses
would suffer or could not survive without migrant labour. Treasury
studies suggest that around 15% of UK trend growth depends on
inward migration, and that while foreign-born migrants make up
8% of the population, they generate 10% of our Gross Domestic
Product. A recent study by the East of England Development Agency
has recently estimated the revenue gain from migrant workers in
the region is at £360 million per annum.
It may well be the case that the concentrations
of migrant workers, in rural areas, are lowering the age profile
of some otherwise ageing rural districts. Therefore we may be
seeing more socially sustainable communities and a creation of
a more viable market place for services in some areas.
What impact, if any, has immigration had on education
and training?
56. Whilst the cost of providing English
language courses is not a distinctly rural issue, we feel that
recent reports by the National Institute of Adult Continuing Education
(NIACE) and the Audit Commission viii made a series of strong
recommendations, which we would advise the Government and others
to respond to positively. There are some distinctly rural aspects
to this issue, mainly surrounding the additional difficulties
migrant workers in rural areas may have in accessing English for
Speakers of Other Languages (ESOL) courses in terms of distance
and time and modes of transport.
We are aware that the Department for Innovation
Skills and Universities has been responding to these concerns.
It is important that National ESOL Forum, funded by the Department
for Innovation Skills and Universities, continues to monitor the
position on ESOL provision, particularly the rural aspects mentioned
above.
What is the relationship between the Government's
migration policies and labour market policies?
57. There are two key differences between
the number of WRS registrations in rural and urban areas. These
are:
(a) there is a seasonal trend in registrations
in rural areas, with September being the peak, and
(b) there is a higher concentration of migrant
workers in certain rural areas. This is further emphasised with
a higher proportion of registrations relative to the local labour
force.
58. Taking these two points into account,
the CRC believes there is a strong need for local strategic partnerships
to review the potential impacts of migrant workers on local services,
on local economies and on community cohesion, with a view to strengthening
the responses of public, private, and third sector bodies to the
challenges and opportunities arising.
59. Indeed, the CRC is aware, despite the
challenges faced by many organisations providing public services,
that there are still commendable examples of public service responses
to the needs and challenges posed by rural migrant workers.
13. How can data on immigration be improved?
60. There has been much commentary and recognition
of the shortcomings of data gathering in this area and it is clear
that there is a need for more accurate data on incoming and outgoing
migration.
What improvements are already being put in place?
No comment.
To what extent have "inadequate data"
affected public policy?
61. Inaccurate data will make informed policy
debate and fair resource allocation difficult.
How confident can we be in forecasts of future
immigration and how important is it that such forecasts are accurate?
62. There will always be flaws in the data
but there should be urgent attempts to improve the accuracy of
data and forecasting.
14. How do the Government's policies, including
immigration and labour market policies, affect the scale, composition
and impacts of migration?
No comment.
How will the points system for immigrants from
outside the EU operate?
No comment
How will the Government decide where there are
skill shortages in the economy as the basis for its points system?
63. Gathering data and intelligence from
a broad cross section of organisations and industries should give
good indications of areas where there are skill shortages. However,
labour market forces can be difficult to predict and therefore
caution should be exercised in intervention.
What has been the international experience, eg
in Australia and Canada, of such a points system?
No comment.
How will the Government respond to employers asking
for non-EU workers to fill low-skilled jobs?
64. It is important to recognise that the
migrant workforce is not a static body; its composition changes
depending on migration flows in and out of the UK. These can be
dependent on circumstances, not just in the host country, but
also in the exporting country. Thus, a migrant workforce that
might be identified as consisting of a particular national group
in one year may be made up of a different group the following
year. This is of particular relevance with Romania and Bulgaria
joining the European Union in 2007.
65. Workers from Romania and Bulgaria will
initially be restricted to existing quota schemes to fill vacancies
in the agriculture and food processing sectors. Much of this work
takes place in rural areas. They will have rights to work limited
to six months and this will not give them access to benefits or
to public housing.
15. Should more be done to help immigrants
boost their productivity in the UK?
66. In order for overseas migrants to fully
contribute to the economy it is necessary to gear a range of organisations
and institutions up to meet the demands that successive waves
of migration will bring. This is particularly the case in rural
areas where there has been no significant history of migrants
working or settling in the community.
67. There is scope for Regional Bodies and
Employers possibly working together to do more to ensure that
migrant workers are equipped with the information they need to
ensure that they are aware of their employment rights, health
and safety at work issues, accommodation and transportation concerns
and local customs. So that migrants are able to contribute fully
to the economy and feel secure in the communities in which they
live.
68. There is a growing recognition that
local communities, particularly in rural areas where there is
possibly no precedent or experience of migrants from abroad, need
support to equip themselves to welcome migrants. The social cohesion
issues that are emerging in some parts of rural England demonstrate
that local communities need support and advice and in some cases
capacity to deal with influxes of migrants. Preparing communities
for successive waves of migrants now will help ensure that in
future conflicts associated with prejudice and racism may be reduced.
This should include work in schools and youth orientated organisations,
colleges and leisure facilities. Also Parish and Local Councils,
Voluntary sector organisations and association
69. There would be benefit in RDAs, working
in partnership with others, undertaking mapping of training provision
for English for Speakers of Other Languages (ESOL) in their regions
and looking at the location, content, timing and access to courses
to meet the needs of rural, and other, migrant workers and their
employers. RDAs may also want to undertake economic risk analysis
to local economies from any sudden disruptions to the supply of
migrant labour, and to put in hand contingency planning if this
is considered necessary.
29 September 2007
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