Immigration and wages in UK

Much has been made of the research by Sir Stephen Nickell on the impact of immigration on wages, in which he suggested that there was “a small negative impact on average British wages.” That was specifically for semi/unskilled workers.

The impact is, however, infinitesimally small! As Portes showed, the 1% fall in the wages of low-skilled workers due to immigration was spread over a period of eight years.

There was no negative impact found from immigration on the wages of skilled workers and professionals.

Wages have fallen because of various factors, including, extreme pay inequality, lower bargaining power of workers/employees, public sector’s pay freeze, the financialisation of the economy, occupational changes, NOT immigration.

For some reading, here is the Resolution Foundation’s report; and the following economists:

Blanchflower & Machin – ‘Falling real wages’

Mazzuccato – ‘Definancialising the real economy’

Pessoa & Van Reenen – ‘Wage growth and productivity growth’

Machin & Costa – ‘Real wages and living standards in the UK’

Costa & Machin – ‘What’s happening with real wages and living standards in the UK?’

Bell & Van Reenen – ‘Extreme pay inequality’

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