David Davis MP: Labour's mass immigration policy inflated growth figures and depressed the wages of unskilled workers

David Davis MP is a former Shadow Home Secretary. In this article he argues that lain Duncan Smith is correct to challenge business leaders about who they employ. "The leaders of British business," he writes, "should remember that they are British citizens too, and they owe our society a duty of care in exchange for the chances it gave them."

I have a great deal of sympathy with Iain Duncan Smith’s call to UK business leaders to give British workers a fair chance.

Not for a second do I think British businesses should discriminate in favour of British applicants with no work ethic over foreign applicants with a strong work ethic. But in discussion with some British employers these days I get the strong impression they actively set out to recruit foreign workers, sometimes directly from their home country, or even move their operations offshore. It would be refreshing to see more British companies follow the example of New Call Telecom, who have just moved their call centre operations back from Bombay to Burnley.

So it seems to me that Iain Duncan Smith had a point.

There are those who might say he is simply replicating Gordon Brown’s call for “British jobs for British workers”. The difference is that Iain Duncan Smith is trying to solve a problem which to a great extent was created by Brown.

Indeed Gordon Brown’s comment was arguably both crude and hypocritical.

For more than a decade Labour had pursued a deliberate, if covert, open door policy of mass immigration. Some of it was simply incompetence, but much of it was both intentional and utterly dishonest. The covert nature of the policy eventually led to Immigration Minister Beverley Hughes losing her job, ruthlessly sacrificed by a government that knew exactly what it was doing.

It was a remarkably cynical policy even by the standards of the Brown-Blair governments. Most of the reasoning behind it came from Brown and the deceitful economic policy he invented.

The first reason for Labour’s commitment to mass immigration was obvious. If you bring vast numbers of immigrants into the country, this inflates economic growth figures, even if they all only earn a minimum wage. This of course flattered Gordon Brown’s performance as Chancellor, even though it did not increase the income per person of the population at all.

The second reason was even more cynical. A combination of measures, from the minimum wage to Brown’s easy credit and low interest rate policy, all threatened to increase inflation, particularly wage inflation. Bringing in large numbers of immigrants depressed wages, particularly for unskilled workers. For low skilled jobs in places with high immigrant populations, like London, the minimum wage almost became a maximum wage. In the high immigration years from 2004 onward, the income of the bottom 20% fell despite the economic boom.

Third, Labour’s immigration policy helped disguise a serial failure in the education system. Britain was simply not providing enough young people with the range of skills and personal attributes a modern economy needs. The answer was simple; plug the gap with recruits from everywhere from Poland to Pakistan, from Estonia to India.

Finally, it also covered up another even more serious problem, largely created by Brown himself. When he became Chancellor, Brown imposed complex welfare schemes that undermined our national work ethic. All too often it paid more to stay at home than go to work. As a result we have created a generation where many accept life on welfare.

During the boom years of 2004-2008, youth unemployment grew by 100,000. Labour’s welfare and immigration policies combined to institutionalise a generation into the habits of unemployment.

Had it not been for mass immigration, Britain’s employers would have been screaming blue murder over labour shortages and the shortage of good workers. The complaints we now hear about British attitudes to work would have surfaced much earlier, and no doubt embarrassed Brown. Even a Labour government would have had to recognise the problem and done something about it. Instead British employers were able to look abroad.

If anybody raised these issues five years ago, they were at risk of being accused of racism, or at the very least little-England nationalism. It was therefore exquisitely ironic when Brown advocated “British jobs for British workers,” since in the previous decade 4 in 5 new jobs had gone to foreign nationals.
Despite the crude language, Brown was reacting to the public’s justifiable anger at a very real problem-albeit one of his own creation.

So lain Duncan Smith was in the right when he pointed, in a far more intelligent way than Brown, to the same problem. With the UK population now growing at its fastest rate for 50 years, largely as a result of uncontrolled immigration, we are in danger of excluding part of the indigenous population from any sort of productive life. As we bring the bloated state that we inherited from Brown down to an affordable level, we have to encourage the private sector to take its place. That is no use, however, if the private sector employers fail to make use of the very people we are trying to help.

So before they criticise lain Duncan Smith, the leaders of British business should remember that they are British citizens too, and they owe our society a duty of care in exchange for the chances it gave them. If their employment strategies demand levels of immigration that put pressure on public services, or housing, or infrastructure, we all have to pay taxes to fund it. If their strategy leaves large numbers of young people on the scrap heap because their education or their attitudes are “not good enough”, we will all have to cope with the social problems, racial tensions, and crime that that will engender.

That being said, when about 60% of employers reject applicants because of poor work attitudes, poor work ethic, and poor presentation, something is badly wrong. A report, due to be published today by the Centre for Social Justice, points out that “timekeeping, self awareness, confidence, presentation, communication, teamwork, and an ability to understand workplace relationships are too often below the standard required, particularly in younger job seekers.” We are not talking here about managerial or sophisticated senior roles. We are talking about unskilled, entry level jobs, the bottom rung of the ladder. These jobs make up perhaps 9 million of the 27 million jobs in the UK economy.

So we are facing a social catastrophe if we do not get a grip. We need to slow down our rate of immigration very sharply to create space for our own citizens. We need to transform our educational institutions so that they engender an appetite for work in our young people that delivers the attitudes and work ethic Britain needs. We need to improve our business environment through lower taxes and less regulation. And we need to create a welfare system that makes work worthwhile, as lain Duncan Smith is endeavouring to do.

In none of this should we be inhumane; in Churchill’s words, we should seek to create a society in which “there is a limit beneath which no man may fall, but no limit to which any man might rise.”

If we do not act, and act quickly, we will fail a whole generation. That generation will miss their opportunities and fall into a lifetime of institutionalised failure, denied their opportunities by a society that was too complacent to care.