Don't blame immigration for our poor training record
In his pre-conference speech, Labour Party leader Ed Miliband predictably raised immigration, but rather less predictably, turned the spotlight on skilled migration, announcing that:
'We are going to say to any firm that wants to bring in a foreign worker that they also have to train up someone who is a local worker, training up the next generation.'
The assumption behind this measure is that employers currently recruit migrants rather than put in the time, money and effort to train resident workers. But is this correct and is the ‘British apprentice for every foreign worker hired’ as simple and straightforward as it sounds?
In 2012 we published research for the Migration Advisory Committee on high level skills, in which we investigated whether recruitment of skilled migrants is used as a substitute for training of resident workers. We looked both at existing evidence, at data on skill levels of migrants and natives and interviewed employers in banking, aerospace and pharmaceuticals. These employers included a number of employers in the research regularly recruited migrants. They did this because they could not find the skills they needed from within the UK, and used the Tier 2 occupational shortage route, or Intra-Company transfers to bring migrants to their organisations.
A clear finding from the research was that firms hiring skilled migrants already employ large numbers of skilled British workers already – and have invested in their skills themselves through apprenticeships and on-going training. This was apparent both in our case study research and in our analysis (based on Labour Force Survey data) of the incidence of training in sectors identified as key users of high level skills. A number of case study firms also worked with schools and universities to stimulate interest in their sectors among young people. Many felt they were doing as much as they could, given their own resources and capabilities.
Ed Miliband’s policy involves apprenticeship training, but our research found that this was not the level at which migrants were recruited: many shortages are at graduate level and above.
Employers would agree that there is scope to reduce recruitment of skilled migrants through improvements to training and education. But they believed this needs to be addressed at a higher level, including through improvements in Higher Education, rather than apprenticeship programmes which were already in place.
Their suggestions included closer tailoring of courses to high level skill needs and incentives to students to take subjects in demand by employers, particularly engineering. Closer working between employers and education, particularly HE, to help meet skills shortages was also proposed. However, they said that this is not a straightforward process and requires Government investment and support. The measures required would take some time both to put in place and to produce skills at the advanced levels required by employers. Moreover, they require continual investment and need to be flexible to respond to changes, in such areas as technology, products and markets. These changes make it difficult for training to keep pace with employer skill needs, but only a very high level of responsiveness can allow for more high skill needs to be home-grown rather than obtained through migration.
Employers felt strongly that their own efforts alone were not enough to meet the UK’s skills gaps and that to do this, more public investment is required in training, particularly through funding of provision by regional colleges who feed skills into sectors such as engineering. What employers don’t want is more red tape which, as the British Chambers of Commerce and CBI have warned Ed Miliband’s proposal would bring. Neil Carberry, the CBI’s director of education and skills at the CBI, described them as a ‘bureaucratic nightmare’ exacerbating current difficulties with the Tier 2 application process.
So if this investment was made, could employers stop recruiting from outside of the UK? While employers and stakeholders felt that training could address some of the skills shortages which are currently met through inward migration, it was not regarded as a complete solution, even in the long term. This was because employers sometimes require specific combinations of qualifications and experience which are difficult to find. Just as importantly, migrants bring with them additional value through their international experience, language skills and knowledge of business operations and culture in particular locations.
Employers value migrants not only for their technical skills but for their addition to the diverse mix of backgrounds and skills which organisations need to compete internationally. Both our research and previous studies have found that, as a result of growing internationalisation of markets, many multinational firms now devote considerable resources to ‘global talent management’ and to the career development of valued staff. One of their key requirements is for managers and professional staff who combine knowledge of business practices in different countries with extensive experience within their own companies. Many multinational firms depend on free flows of personnel across international borders within their organisations to help meet these requirements.
Ed Miliband is right to put training on the political agenda, but in pointing the finger at firms who recruit skilled migrants, he is attacking the wrong target. The proposal fails to address the lack of training and opportunities for workers in low skilled occupations and sectors, and competition for these jobs between migrants and UK born workers. This is where training efforts should be targeted, to give British workers the opportunity to move out of low skilled work, and to make use of current under-use of migrants’ skills. But the real harm of the proposals is that they blame immigration for the problem of failures of our training and skills system which are long-standing, deep rooted and have nothing whatever to do with immigration.