London’s global workforce: How immigration fuels innovation and prosperity in the capital
Britain’s capital is the most productive and prosperous area in the country, partially because of the 1.8 million migrant workers that currently call it home. They pay a huge amount of money to the national economy, help diversify the labour market accessible to businesses, and provide for further cultural diversity. Some have even been able to start businesses and create new opportunities.
Despite the clear benefits that Britain’s capital derives from immigration, it can be challenging to secure visas so that top talent can join your firm. If you need help acquiring a sponsor licence or helping your prospective foreign hires get visas, contact a London immigration lawyer today.
Who is coming?
The 1.8 million migrant workers in London come from locations all over the world and have a range of backgrounds. However, a study by the London School of Economics and Political Science (LSE) notes that economic migrants to London are relatively young and are qualified above the domestic average. This is particularly the case with those coming from wealthy countries.
Migrants from wealthy countries are more likely to remain in London for a short period, a few years, before returning home or migrating to another country or area in the UK. However, while in London, they help grow its economy by providing diverse, flexible, and international skill sets. They also expand the supply of labour and contribute to growth. Such benefits are explored in the remainder of this article.
Prosperity
The most quantifiable benefit of immigration to London is economic migrants paying directly into the London economy and the tax revenues of the national and local governments. Each immigrant pays an average of £46,000 Gross Value Added (GVA) to the London economy, helping pre-existing businesses to thrive.
Moreover, their tax payments help to fund public services. Data from the HMRC in 2018-2019 found that immigrants consistently pay more into the public purse than they take out in available benefits. In that tax year, EEA nationals made a total positive contribution of £22.4 billion, and non-EEA nationals’ positive contribution was £20 billion. This is £2,300 higher than the average British citizen for EEA nationals. Considering that wages, and therefore tax bills, are higher in London, we can expect this average to be higher for migrants to London.
Migrants may also boost local prosperity as entrepreneurs, starting businesses that can meet local needs and provide work for local people. There is a rich history of migrants starting businesses in London which went on to have a seismic impact on Britain’s business scene. Examples include Marks & Spencer founded by Michael Marks, born into a Polish Jewish family, and Britain’s first coffeehouse chain Costa Coffee, founded in the 1950s by the Italian Costa brothers.
Labour markets
Aside from the raw quantitative economic benefits of migration, your company is likely already experiencing qualitative benefits. Put simply, economic immigration acts as an elastic source of labour in London, helping to deal with temporary bottlenecks that occur in the domestic labour market. It is worth looking abroad if you have a job opening that you are struggling to fill with British workers.
Such benefits are particularly pertinent for small businesses, as has been experienced in London and for the 5.8 million small businesses in the country. A Federation of Small Businesses article found that 38% of small businesses struggle to fill job vacancies yearly.
Sometimes, migrant workers in London can also provide unique skills that can bring additional value to your business. In particular, skilled migrant workers have a higher chance of possessing knowledge of foreign markets and language skills. These workers can play a pivotal role in bringing your business to new parts of the world.
Despite the benefits born by a diversified and more populated labour force for London’s labour market, politicians on the British right have continually critiqued economic immigration. They have argued that it reduces the wages accessible to British workers and makes it harder for them to access work. However, the University of Oxford’s Migration Observatory has dismissed these claims in London and across the UK. Their studies have concluded that immigration consistently positively impacts high-wage workers and describes the risk of low-wage workers losing out as ‘small.’
Multiculturalism
Alongside the tangible benefits of migration to your business, it can also make London a more pleasant place for your workers to live by enriching the local culture. London’s non-hegemonic culture has been shaped by immigration for decades.
One key example is the Windrush generation, who came to London from the Caribbean in the post-war years, bringing with them music, food, fashion, and traditions that had previously been unheard of in the capital. Such cultural transformation has continued since then, as further generations of immigrants have come to the UK.
Securing success for your international workforce
Economic immigration has brought economic and cultural benefits to the whole of London’s society, but it also has the potential to transform your business. You can create a more culturally diverse team that has the skills to thrive and the capacity to work in international markets.
However, hiring foreign workers and adding to London’s skilled migrant worker pool is not as simple as making a job offer. You will need to make sure they can access the right visa, and you may need to get a licence to sponsor your chosen worker. It is highly recommended to enlist the help of an immigration lawyer or adviser to secure the highest chance of success.
