The EU: IN or OUT?

BananaRepublic

Linton wrote: »

Yes - this is key.

These days, to be successful tech and high value engineering companies must have a very large market. This market can be global or at the moment can be restricted to a large single market. The US is large enough, the EU is large enough, the UK isnt.

To compete, these high value companies must be able to attract skills from among the best in the world with minimal hassle. Those countries which allow unrestricted entry to people with such skills will have massive advantages over those that dont.

If by high value you mean high added value per item sold, then no, what you say is simply wrong. I have worked with many small companies that have found a niche product, and competed highly successfully around the world. The key is to understand the marketplace, and find a high value product that either fills a vacant niche or does it better than existing solutions. The oil and gas industry is full of such small companies. It takes confidence, knowledge and risk taking to create a new product.

Linton

BananaRepublic wrote: »

If by high value you mean high added value per item sold, then no, what you say is simply wrong. I have worked with many small companies that have found a niche product, and competed highly successfully around the world. The key is to understand the marketplace, and find a high value product that either fills a vacant niche or does it better than existing solutions. The oil and gas industry is full of such small companies. It takes confidence, knowledge and risk taking to create a new product.

I agree with you completely. Small niche companies can do extremely well operating within the gaps provided by global industry and they are important for the UK.

However they are frequently short lived. They go bust if they fail or may be taken over by global companies if they succeed (eg ARM). In the latter situation the technology and key staff may be moved elsewhere and the original company disappears - what happens if ARM is sold on to say Intel? The UK is too large to run as a set of small niche players, and much of the population wont have the specialist knowledge to find employment in such companies.

In your small companies are a significant number of key staff foreign born and perhaps UK university trained?

BananaRepublic

Linton wrote: »

I agree with you completely. Small niche companies can do extremely well operating within the gaps provided by global industry and they are important for the UK.

However they are frequently short lived. They go bust if they fail or may be taken over by global companies if they succeed (eg ARM). In the latter situation the technology and key staff may be moved elsewhere and the original company disappears - what happens if ARM is sold on to say Intel? The UK is too large to run as a set of small niche players, and much of the population wont have the specialist knowledge to find employment in such companies.

In your small companies are a significant number of key staff foreign born and perhaps UK university trained?

As I understand it the key to the German economy is lots of small companies. For example, the HufHaus. The small companies I have worked for have lasted a good time, 25 years in many cases. One grew quite large, and created a small off shoot called Vodafone, which has since done quite well. The parent has since collapsed, but after many decades of existence. Companies do disappear, market crashes and changes in technology create opportunities for new players, and drive old ones out.

Most engineering staff are/were UK nationals. These are small companies that reward staff.

Glen_Clark

Linton wrote: »

high value companies must be able to attract skills from among the best in the world with minimal hassle. Those countries which allow unrestricted entry to people with such skills will have massive advantages over those that dont.

I don't think anybody is arguing with that. The problem is letting in immigrants with skills we already have a surplus of, leading to older British workers being displaced on to benefits.
(To make matters worse benefits have to cover Britain's inflated housing costs, wages don't, so many people are better off on benefits)

bigadaj

Linton wrote: »

Globalisation as a major factor is relatively recent as is free movement of labour within the EU. Free movement of labout improves the efficiency of globalisation. The effects will take some time to work through. When they do, those companies, or operations within companies, with easy access to a global pool of labour will have a significant advantage over those that dont. The effect is that business will move to countries that provide it.

Labour mobility has worked in some areas - agriculture, finance and the high tech companies around our universities for example. The latter acould be our best hope for the future and if they are to grow need access to a larger pool of specialist staff than can be supplied from the UK.

Looking back at history gives us some lessons. The industrial revolution could only happen if sufficient labour was able to move where the work was within the UK. This resulted in large movements of wealth within the UK. I believe we are now seeing the start of the same process on a global scale.

Possibly, but it doesn't work in a country which has allowed access to low wage immigration for radically poorer countries. This has resulted in huge amounts of benefits being paid out to allow low earners, both native and immigrant, to live.

History might have some lessons, but these weren't learnt when we had a huge benefits system to maintain, whether that be education, health, housing etc

There was a bit more incentive for people to move where work was, even when that meant 12 hour days, six days week, and earning enough to live in a shack and eat gruel. When you have to pay a percentage of people's rent and other costs, or the government has to rather than the employer, then the overall benefits from migration change somewhat. If you combine that with the company paying little uk tax then it's a difficult circle to square.

Linton

I agree its difficult to maintain a benefit subsidised low wage economy with freedom of labour. However our problems will be even worse if we are not able to ensure that the UK is a desirable place for the multinationals to establish major operations. Limiting the choice of who they can employ isnt the way to do it. There is a serious shortage in this country of skilled people and people willing to do undesirable jobs. The market for skilled and flexible people is global, suitably skilled and/or motivated people from this country can work across the world. If those from other countries cant work here or dont want to work here because of insecurity and major hassle we lose.

CLAPTON

Linton wrote: »

I agree its difficult to maintain a benefit subsidised low wage economy with freedom of labour. However our problems will be even worse if we are not able to ensure that the UK is a desirable place for the multinationals to establish major operations. Limiting the choice of who they can employ isnt the way to do it. There is a serious shortage in this country of skilled people and people willing to do undesirable jobs. The market for skilled and flexible people is global, suitably skilled and/or motivated people from this country can work across the world. If those from other countries cant work here or dont want to work here because of insecurity and major hassle we lose.

do all foreign countries allow unlimited immigration?

Linton

CLAPTON wrote: »

do all foreign countries allow unlimited immigration?

Its not unlimited immigration that is important but rather size of pool of skilled labour.

We can look at the main industrialised areas of the world...

The EU has free movement of labour creating a single market for employees of some 500M people.
The US is a single market for employees of 320M people. Also, it seems to be easy for Canadians to work in the US.
UK with a population of 64M but has free movement of Labour with the EU.
Japan with minimal immigration and a population of 127M - perhaps a Brexit model?

and immigrants as % of population
US:14%
UK:11.3%
JPN:1.9%

Lets look at the average GDP per capita growth rates over the past 20 years from my calculations from UN data:
US: 1.45%
EU: 1.42%
UK: 1.55%
Jap: 0.71%

bigadaj

Linton wrote: »

Its not unlimited immigration that is important but rather size of pool of skilled labour.

We can look at the main industrialised areas of the world...

The EU has free movement of labour creating a single market for employees of some 500M people.
The US is a single market for employees of 320M people. Also, it seems to be easy for Canadians to work in the US.
UK with a population of 64M but has free movement of Labour with the EU.
Japan with minimal immigration and a population of 127M - perhaps a Brexit model?

and immigrants as % of population
US:14%
UK:11.3%
JPN:1.9%

Lets look at the average GDP per capita growth rates over the past 20 years from my calculations from UN data:
US: 1.45%
EU: 1.42%
UK: 1.55%
Jap: 0.71%

That EU figure looks optimistically high.

An interesting issue I think is everyone's obsession with GDP. If you look at recent immigration figures then these seem to be regularly increasing the population by around 0.5% per year; GDP per head seems a far more reliable figure of whether people feel they are better off or not, and so the increase in population needs to be accounted for.

savings_my_hobby

BananaRepublic wrote: »

I agree. And why train a UK worker, when you can import a cheaper trained immigrant?

There in lies the problem, although if employers won't train us then we must learn from elsewhere like Further Education or trail and error practice.

The onus is on the employee to have the skills employers want.

This is where immigration is essential, If we can fill a skilled vacancy then we must but this was not how immigration works within the EU. We had to accept any person from 27 other countries, regardless of skills, regardless of language skills.

How are we to plan for an unknown amount of people?

I honestly believe that if two equally qualified people with similar commitments applies for the same job then the UK citizen should get priority and perhaps some more full time 40 hour contracts for the roster of underemployed stuck in that 16hr a week rut would not be too much to ask.
Sure it suits some people to work 2 days a week and get their wages topped up but most would surely enjoy the benefits that go with full time employment.

There is a real issue about employment agencies leeching these benefits away from the workers.