We noted last week how UK wages have boomed to post-GFC highs on Brexit immigration cuts:
This comes alongside the GBP crashing, driving huge competitiveness gains, de-bottlenecking Britain, lifting living standards, and even driving gains in productivity:
And the tonic has been Brexit immigration cuts:
The decline in EU immigration into the UK in the wake of the Brexit Turmoil has proven to be a massive boon for workers, with unemployment also falling to the lowest level since the 1970s amid the strong wage growth:
The rising in worker share has angered UK employers, who have demanded that the Boris Johnson open the floodgates to cheap migrant workers. From the BBC:
The next prime minister should lower the salary threshold for foreign workers in the UK from £30,000 to £20,000, a group of business and education bodies has said.
They say that such a move would help to avoid “acute” skills shortages.
Currently any non-EU citizen working in the UK must earn at least £30,000, but under current proposals this will be extended to EU citizens after Brexit…
However, the coalition – including the British Retail Consortium, business advocacy group London First, Universities UK, and UK Hospitality among others – warned that more than 60% of all jobs in the UK were currently beneath the £30,000 cut-off.
“It is vital that the government does all it can to keep the country at full strength at a time of great uncertainty. The thousands of businesses we represent are clear that without a bold move now on immigration reform, the skills shortages many companies face risk becoming even more acute,” said Jasmine Whitbread, chief executive at London First.
The coalition also called for more generous temporary and post-study work visas, following curbs in recent years to lower immigration…
Here’s more from Yahoo:
With shortages of specialist workers already holding back some sectors, they called for temporary visas to be extended to two years, reforms to let firms sponsor more overseas recruits and the restoration of the two-year visa for new international graduates…
“Our country needs a fair and managed immigration system that keeps it open to all levels of talent,” they wrote in a joint letter to the rivals to become Britain’s new prime minister…
Helen Dickinson, head of the BRC, said retailers relied on the skills of 170,000 EU nationals.
“We want the salary thresholds lowered, reflecting the range of skills required for the jobs,” she said.
The motive behind the UK employers special pleadings is obvious: to lower wages and boost their profits. It has nothing to do with the national interest.
Except in very limited circumstances, there is no such thing as a shortage of labour. There is only a “shortage” of labour at the price/ wages firms are generally willing to pay.
The very purpose of migrant workers is to suppress wage growth by allowing employers to recruit from a global pool of labour to compete with local workers. If UK employers want to attract workers there is a simple solution: raise wages. This is how the “market” is supposed to function when their are shortages.
Allowing the mass importation of foreign workers will circumvent the ordinary functioning of the labour market by enabling employers to pluck cheap foreign workers in lieu of raising wages. It will also discourage employers from training locals in favour of hiring ready-made workers from overseas. This is deleterious for both workers and the broader economy.