The nature of the post-Brexit migration change is different to what many expected

The latest migration statistics, covering the year ending December 2022, confirm that the post-Brexit era has brought significant changes in migration patterns. The predictable headline was that overall net migration reached a record high, but the labour market nature of this change differs from what many expected – with the migrant workforce growing slower than the pre-Brexit period. In this data-driven blog, we explore some labour market aspects of the post-Brexit migration changes that are often misunderstood or overlooked.

Record net migration has been driven by non-EU migrants

Today’s migration statistics confirm something most people already knew: Brexit has changed migration patterns a great deal. Overall net migration – the number which will hog today’s headlines – increased to a record high of 606,000 (someway short of the one million some predicted) in the year ending December 2022. Non-EU migration primarily drove this growth, with a net inflow of 652,000 migrants into the UK over the course of 2022.

Despite the fact that migration debates are often framed in terms of the impact on the labour market, the majority of non-EU migrants in 2022 were coming for reasons other than to work, with the most common reasons for coming to the UK being to study (39 per cent), to work (25 per cent), or for humanitarian reasons (19 per cent). The rise in non-EU migrants has been driven by several unique factors, such as the Ukraine war (which has boosted the numbers leaving via humanitarian routes) and the end of Covid-19 restrictions (which has boosted the number of students coming).

But the migrant workforce is growing more slowly than it was pre-Brexit

In the heat of the debate about whether migration on this scale is a good or a bad thing, there is a risk that we are overlooking the big changes to work-related migration that have taken place since the Brexit referendum.

First off, let’s talk about the scale of change in the migrant workforce. Analysis of the Labour Force Survey shows that the number of non-UK born workers rose by 170,000 between Q4 2021 and Q4 2022. This figure is, admittedly, higher than the average number the UK saw between the Brexit referendum and the pandemic (which stood at around 87,000 extra migrant workers per year). But it falls significantly short of the 2003 to 2015 average of an additional 230,000 migrant workers each year, let alone the mid-2010s peak of 430,000 (again comparing the final quarters of each year). Put simply, the migrant workforce is growing more slowly than it was back in the mid-2000s and early 2010s.

Non-EU workers form an increasingly large share of the workforce

Another important feature of the UK’s post-Brexit labour market is the change in the share (and absolute number) of workers born outside the EU. The rise in the migrant workforce over the course of 2022 has been driven exclusively by non-EU workers (up by 220,000 between Q4 2021 and Q4 2022). This continues the longer-term trend of a rising share of workers who are non-EU born – reaching 13 per cent of the workforce in early 2023, compared to just 5 per cent back in 1997.

Migration patterns have shifted away from the capital

Third, migration patterns have shifted away from the capital. Although London is the region with the highest share of non-UK born workers – around 44 per cent in 2022 – Inner London was the only area of the UK to see a fall in the share of both EU and non-EU born workers (down one and three percentage points, respectively), and a significant rise in the share of UK-born workers between 2016 and 2022.

By contrast, the West Midlands saw the biggest fall in the share of UK-born workers (down 5 percentage points) as well as the biggest increase in non-EU born workers (up 3 percentage points), while Strathclyde saw the biggest increase in EU-born workers (up 2 percentage points).

More generally, the role of reduced migration in current discussions around labour shortages for the economy as a whole appears to be overdone. As we show below, the migrant share (be that EU or non-EU born) of the workforce continues to increase in almost all parts of the country.

Stepping back, the headlines will all focus on the new record for overall net migration – driven recently by students and people arriving for humanitarian reasons. Record levels have often sparked furious debate in politics and society, but our new post-Brexit migration regime is changing our labour market in different ways from what we expected. The nature of this change – be that a reduced concentration of migrant workers in the capital, or a shift to non-EU workers in some sectors – will require forensic scrutiny over the coming years. Assessing these and other facts will help inform current and future debates about migration policy.