Thursday, 18 October 2007

More Hidden Economics

immigration

Immigration will feature ever more strongly in daily politics as the 21st century unfolds. In Britain immigration will be seen as an essential component of economic growth and a prerequisite for a healthy economy. But this will not happen in the same way as in the US and Australia in the 19th and 20th centuries, when they built multicultural societies on a positive historical legacy of integrating waves of migrants through the common goal of citizenship.

Instead, by 2020 British immigration policy will be founded on the fact of our ageing society. Britain will have fewer people of working age trying to support a growing number of retired people. Britain is likely to encourage immigration on a scale that current levels only hint at, but in the process there is a danger we will develop a two-tier workforce that has more in common with the gastarbeiter economy of the old West Germany than on any American melting pot example.

The basis for that prediction lies in the United Nations report Replacement Migration, published in 2000. It estimated that Britain needs to attract a million people a year between now and 2050 to maintain the balance between the workforce and the retired population. That might be regarded as unduly pessimistic, but even the most recent figures from the government actuary suggest that by 2020 there will be 20% more older people than younger adults.

The majority of people in their 60s and 70s will be healthy and active; they will demand ever more consumer items and the personal services that go with increased leisure time. There will also be a growing welfare sector to care for the ageing population. The retirement homes of Bournemouth and Eastbourne will become key models for economic regeneration projects across the country. Home Office studies predict this will mean an increase in low-paid, low-skilled jobs that may be difficult to fill from the existing labour force.

The pattern is already beginning to emerge in the hospitality and catering industries, where low-wage jobs with little security are increasingly being filled by migrants. The government's role is to ensure they can come here legally and get paid the minimum wage. But for this strategy to succeed longer-term, British governments will have to have come to terms with the flourishing hidden economy of illegal migrants. Otherwise the two-tier workforce will be even more likely.

That means that a way to "regularise" the position of illegal migrants already in Britain will have to be found. By 2020 it could become a regular feature of British life, with amnesties granted to illegal immigrants before each general election. And if you think that could not happen, look to the US. Earlier this year, President George Bush thought it politic to give three-year work permits and possible citizenship to up to eight million "undocumented" workers living mainly in New Mexico and Arizona. His "compassionate conservative" move was, of course, really an attempt to capture the increasingly powerful Hispanic vote. Migrants here could soon hold equivalent political power.


SOURCE: Guardian Unlimited, September 18, 2004

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