If we vote for Brexit what happens

CLAPTON

Generali wrote: »

For anyone that's interested in the actual measured effects of immigration on the labour market in the UK, this is probably the best place to start:

http://www.migrationobservatory.ox.ac.uk/briefings/labour-market-effects-immigration

There is a small depressive effect on the wages of the lowest paid (an increase via immigration of 1% of the labour force decreases wages of the worst paid 5% by 0.6% compared to their outcome in the absence of immigration).

As net immigration to the UK is about 1% of the population the maximum impact on the most heavily impacted each year is that their wages rise by 0.6% less than otherwise. Clearly there are two things that will in reality reduce the impact on those people:

1. Not all immigrants work (some are children/OAPs/SAHMs)
2. In-work benefits will top up those wages so the burden will fall on higher earners in the round as higher earners are net payers of tax and they also tend to benefit from immigration.

It's a fascinating piece and really worth reading right through. It contains empirical support for both sides of the argument regarding immigration and some quite surprising findings (e.g. the worst impacted by immigration is earlier immigrants!).

The main take away for me is that the impact of immigration on the receiving country is pretty small in economic terms. The bottom 5% might lose 0.6% of their income but that income is less than £10,000 a year so the loss is about a quid a week before benefits.

reading the actual paper it would seem

1. Immigration doesnot in general make the host country richer but the effects depend upon time and place.

The impacts of immigration on the labour market critically depend on the skills of migrants, the skills of existing workers, and the characteristics of the host economy. Research evidence on the labour market effects of immigration is thus always specific to time and place.

So this means that while immigration MAY have had no adverse effect of wages in the early 2000s , it is no guide to the situation today.

2. It acccepts that in the short term immigration can depress wages for the lowest paid

The immediate short run effects of immigration on the wages and employment of existing workers depend particularly on the extent to which migrants have skills that are substitutes or complements to those of existing workers (e.g. Borjas 1995). If the skills of migrants and existing workers are substitutes, immigration can be expected to increase competition in the labour market and drive down wages in the short run. The closer the substitute, the greater the adverse wage effects will be. Whether and to what extent declining wages increase unemployment or inactivity among existing workers depends on their willingness to accept the new lower wages. If, on the other hand, the skills of migrants are complementary to those of existing workers, all workers experience increased productivity which can be expected to lead to a rise in the wages of existing workers.

worth noting here that 'short term' means 5-10 years : if your wages were depressed for 10 years you may consider this quite a long time.

3. it recognises many limitation with the methodolgy and data

t is important to recognise that the analysis of the labour market effects of immigration faces a number of methodological challenges. For example, as migrants often go to areas that are experiencing economic growth and strong labour demand, immigration can be both a cause and consequence of changes in wages and employment. This makes it difficult to establish causality.

and

Another problem is that international immigration into a certain area may cause some workers to leave that area and migrate to other parts of the country or abroad. Whenever this happens, the labour market effects in a certain area are dissipated across the country which makes correct measurement through local labour market analysis more difficult.

clearly in London there has been a continuing exit of native born out of London : some I believe have gone as far as Australia.

and of course about the data itself

A third methodological challenge arises from the questionable quality of data on migrants, and especially specific subgroups of migrants, which are often based on small samples of the population and can thus lead to significant measurement error.

The paper doesn't in fact discuss the overall economic impact as it addresses only wages and unemployment
and of course it doesn't address costs and taxes arising from impact of more people or the quality of life or housing, health care etc etc.


but well worth a read.

gfplux

mwpt wrote: »

Where do you speculate they are? There is apparently only 5% unemployment in the UK. When I walk down my high street, the butcher is British, the fruit and veg merchant is British, the plumbing store workers are British, probably the nearby car wash owner is British (though he employs EU nationals), the Waitrose staff all seem to be British (though the nearby Tescos staff all seem to be foreign - not EU), the charity shop workers are British, the bank tellers are British, the man who cleans the roofs locally is British, the gas engineer who lives opposite me is British, the pub staff are British.

This is in London.

Which postal code do you live in.
As I have said from my experience of London during two weeks in Chelsea, Kensington, Knightsbridge, Gloucester Road, Tottenham Court Road and the West End almost all the staff in the hospitality business were from the EU and NOT British.

mayonnaise

Moby wrote: »

Gordon Brown has just given what is generally regarded as the best pro- Europe speech. Taken from The Guardian:-
Gordon Brown's speech - Summary

Gordon Brown’s speech may have been somewhat overshadowed by Boris Johnson’s pasty-waving antics on Cornwall today, but that’s a shame because it is one of the best pro-EU speeches anyone has yet delivered. At his best he can produce oratory that is a class apart from anything you hear from David Cameron, or anyone else in frontline politics today, and we heard some glimpses this morning. Sky’s Faisal Islam says it is the best pro-EU speech he’s heard.
— Faisal Islam (@faisalislam) May 11, 2016 Most impressive pro-EU speech I've heard in campaign so far from Gordon Brown - no project fear, reminds me of his pre-indyref peroration

Didn't see it, our quality press and media decided to concentrate on Boris waving a Cornish pasty instead.

michaels

The BOE says Brexit might lead to an interest rate rise.

Being one of the 30m Britons who has a defined contribution pension scheme I will certainly bear that in mind when deciding which way to vote

gfplux

Generali wrote: »

Working in other jobs.

It's not like the UK has a massive unemployment problem so if they're not serving you dinner perhaps they are in a higher wage job cooking you dinner or doing the accounts for the restaurant.

So we can throw out the idea that EU immigration is taking jobs away from British National.
Now what were the other reasons Free movement was bad for the UK?

gfplux

cells wrote: »

Exactly unemployment is about 5% but if you look at unemployed for more than 6 months its closer to 2% and some of that 2% will be fake (eg claiming while working in the black market) so really we do have v.low unemployment for those who want and try to get a job.

So if a million immigrants are doing the low paid low skilled work then by simple logic that means those who would be doing the low paid jobs such as cleaner and coffee servers are instead in higher skilled/paid jobs

If we import another million new migrants and they get low paid low skill jobs but unemployment still stays at 2% then the old low paid will have moved up a gear

So we can agree that free movement has not harmed the British labour market.
So now immigration is not an issue what were the other arguments against membership?

BobQ

mayonnaise wrote: »

Hooray, we're all going to get filthy rich on our pensions, savings accounts and ISA's once free of the EU's shackles. Why hasn't anyone thought of this before?
Brilliant. :rotfl:

Unless of course you are locked into lower rate, or the banks do not pass it on......

BobQ

mayonnaise wrote: »

Didn't see it, our quality press and media decided to concentrate on Boris waving a Cornish pasty instead.

http://www.mirror.co.uk/news/uk-news/gordon-brown-debate-boris-johnson-7943236

Some extracts

CLAPTON

I see that Carney thinks that half the recent fall in the value of the pound is due to the referendum and fear of brexit : presumably the other half is due to being in the EU.

cells

BobQ wrote: »

Unless of course you are locked into lower rate, or the banks do not pass it on......

if the BOE is correct that an exit will increase inflation then all the people already on a fixed income from historic pensions will suffer

in the short term (maybe upto 5 years) share prices could suffer too

Anyone who thinks they might get better annuity rates needs to look at the rates post inflation which might not be all that improved.

If the economy tanks a downturn, again BOE, then taxes will likely go up and services down


So seems michaels is as prone to confirmation bias as the rest of us