Non-EU Migrant Workers Garner Higher Incomes than EU Counterparts

A recent analysis conducted by The Migration Observatory at the University of Oxford has shed light on a large shift within the UK’s labor market. The analysis clearly shows that non-EU migrant workers are now earning, on average, more than their EU counterparts, marking a substantial transformation in earnings patterns.

The Influence of New Entrants and Pay Scales:

This think tank’s research highlights a noteworthy point since 2018, new migrants from non-EU nations had been entering the UK’s workforce with pay scales that exceed those of EU-origin workers. Furthermore, the statistics indicates that during 2022, fresh EU-origin employees have been beginning their careers with notably lower relative wages compared to the period prior to the pandemic.

Examining Earnings: Non-EU vs. EU:

The statistics shows clear picture of earning disparities. In 2022, the average monthly pay for the whole workforce were £2,162. However, when distinguishing among non-EU and EU workers, a tremendous gap emerges: non-EU workers earned an average of £2,098, whereas their EU EU counterparts averaged £1,936 in monthly earnings.

Implications of Post-Brexit Immigration Policies:

The report’s authors, Jonathan Portes, Madeleine Sumption, and Ben Brindle, speculate that this profits separation may additionally signal a potential setback in the publish-Brexit immigration device’s supposed intention of attracting a better professional cohort of latest EU migrants. Nevertheless, they urge caution, because the 2022 wage figures for brand new migrants best constitute the inaugural year of the newly carried out immigration system.

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Delving into Earnings Trajectories for Recent Immigrants:

The report, stated that the latest earning trajectories for latest immigrants,” is based on a meticulous evaluation of information sourced from HM Revenue and Customs (HMRC) Pay As You Earn (PAYE) Real Time Information (RTI) system, pass-referenced with the HMRC Migrant Worker Scan. The latter database contains information from the Department for Work and Pensions (DWP), which issues National Insurance numbers to people arriving within the UK aged over 16.

Accelerated Progress on Pay Scales for Non-EU Workers:

Within the dataset, there emerges a interesting trend non-EU origin employees appear to advance up the pay scale more rapidly than their EU counterparts. While non-EU entrants arriving in 2015 took approximately six years to reach the overall median wage, those arriving in 2019 had already surpassed this milestone within just two years. This suggests robust earnings growth relative to the overall workforce for recent non-EU arrivals, in contrast to EU-origin workers in the same cohort, who experienced slower wage growth.

EU Workforce Trends and the Role of Return Migration:

The data shows that approximately half of the EU workers who registered for work in the UK in 2015 had exited the staff by 2022. While different factors, along with caregiving obligations, unemployment, or self-employment, may additionally account for some of those departures, the report emphasize that “go back migration” is probably the major factor over the long time.

Steady Decline in EU Workers, Surge in Non-EU Workers:

Over the years, the range of EU employees entering the United Kingdom’s workforce has witnessed a constant decline, with a more significant drop during the pandemic. Conversely, there was a great upswing within the employment of non-EU workers by British companies, surging from an annual average of around 180,000 between 2015 and 2019 to 546,063 in 2022. 

Positive Contributions to the Economy Amid Changing Dynamics:

Despite the great shifts in workforce dynamics, the migrant workforce continues to earn more and make positive contributions to the UK economy.