UK economy could get £7bn boost if over-qualified migrants were employed in correct roles

A third of migrants working in the UK are currently employed in jobs they are over-qualified for, reports claims

The UK Houses of Parliament in central London. AFP
The UK Houses of Parliament in central London. AFP

Employing over-qualified migrants in roles that match their abilities could boost the UK’s economy by £7bn, according to a new report published on Tuesday.

A third of migrants (40 per cent) working in the UK are currently employed in jobs they are over-qualified for and not reaching their full economic potential, research by think tank the Institute for Public Policy Research (IPPR) has revealed.

Seven per cent of EU born workers with degree-level qualifications are in low-skilled occupations, compared with two per cent of UK born workers and four per cent of non-EU born workers.

A recent study by the European Commission found that the UK has one of the most overqualified tertiary-educated EU migrant populations in the EU, alongside Italy and Austria.

The report, which assessed the employment of migrants in Britain, says this is a factor in the UK's persistent low productivity which would be resolved by using their untapped skill set which would result in significant economic benefits.

It is calling for more government investment to address the issue through spending on English language courses to schemes which help recognise the qualifications they hold.

The report authors, researchers Marley Morris and Dean Hochlaf, said: “Addressing over-qualification could add around £7 billion to the UK’s annual economic output.

“There is therefore a strong economic case for a new programme of investment in labour market integration – including in English language proficiency, which our research suggests is associated with poor labour market outcomes such as over-qualification.

“We have found that over-qualification is one of the key labour market challenges for migrant workers. Skills recognition should therefore be a priority for investment.

“The Government should support pilot projects for migrant skills recognition and accreditation in other parts of the UK. These projects could focus on particular sectors facing skills shortages, such as construction, IT, and social care.

“The UK has grappled with persistent productivity stagnation since the financial crisis. In this context, skills matching should be a relatively small and low-cost action with immediate benefits for productivity.”

Currently the National Recognition Information Centre is the UK agency for the recognition of international skills and qualifications and provides a skills comparison service but it has been criticised in recent years for being “inaccurate”, the report added.

It is calling for the government to provide extra funding to help migrants when it shortly commences its Spending Review.

Despite the British government launching its £50m Integrated Communities Strategy and an Integrated Communities Action Plan this year, the report concluded the schemes will only make a “meaningful difference” if there is an “ambitious funding settlement” otherwise the gaps will widen.

“The forthcoming spending review offers an opportunity for the government to set out wide-ranging commitments for integration funding,” the authors added.

“If the government is committed to tackling inequalities in our labour market, to maximising the contribution of migrants, and to facilitating greater social contact between communities, then this funding settlement will be a critical step in bringing its integration ambitions into reality.

“The government’s laissez-faire approach to integration in recent decades has failed to sufficiently improve outcomes for migrants – as we explore in this paper, significant gaps in labour market outcomes are still present. Without sustained intervention and a proactive agenda for removing barriers in the workplace for migrants, these gaps are likely to persist.

“Only with a fresh injection of financial resources will the government’s wide-ranging ambitions on labour market integration be fully realised.”

Analysis by the UK’s Office of National Statistics found that around a third of migrants were overeducated for their occupations, compared to 15 per cent of UK workers.

In the last decade government funding for courses teaching English has more than halved and the report says full investment into language lessons needs to be reinstated.

A recent study based on the rise in immigration from Central and Eastern Europe after 2004 found that in London, culturally diverse firms tended to be more innovative.

Last year a study by Aston University found that immigrants are twice as likely as white Britons to be early-stage entrepreneurs.

Published: June 18, 2019 03:13 AM


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