Employers are complaining that without badly paid immigrant labour they’ll just not be able to get the staff. The answer to which is that they’d better start paying higher wages then, eh?
Business groups warned that major industries would face a shortage of vital workers after the government outlined its new points-based immigration system to limit the number of low-skilled workers coming to the UK.
Unions said the care system would be “on its knees” should the policy be introduced without further reductions in the minimum salary, which ministers set at £25,600 unless migrants can show they have a job offer in a “shortage occupation” or have a relevant PhD.
The analysis here stems from something Marx got right. It’s competition among capitalists for scarce labour which pushes wages up. If there’s a vast reserve army of the unemployed then anyone needing more straining backs just tosses a crust to those in that army and gets as many limbs and torsos to exploit as desired. But if all are already employed then any desire for extra labour requires tempting it away from current employer and occupation to the new. That means a better job offer. Some mixture of conditions, enjoyment of the job, cash and so on that makes up a more attractive package.
The combination of cheap flights and free movement of labour has meant that the reserve army lives in Wroclaw and Debrecen. It’s also been near unlimited – compared to the size of the UK economy – these past couple of decades.
The absence of free movement – what is being complained about here – will mean that to gain the desired labour those employers are going to have to offer higher wages, higher compensation rather, to those not ordinarily resident or stemming from central Europe.
The effect of this will be to raise low end UK wages. This is a problem for us, right? Or, actually, are we entirely happy about the idea of low end wages rising? I’m certainly on that second side, what’s wrong with the workers getting pay rises?
Brexit means cutting ourselves off from that reserve army of the unemployed. Wages will therefore rise. And?
Well, the and is that some outputs will become more expensive top produce. And? And some will even become uneconomic to produce. And? Say, for example, that England will no longer grow its own strawberries. And? We don’t grow our own bananas either.
We can even take the Dean Baker view of this. One major complaint – for what it’s worth and that might well be not a lot but still – is that income inequality is “too” high in the UK. If we remove competition for those low end jobs while still leaving the high end ones open to any of the 7 billion who want them this will collapse the income inequality, won’t it? If not collapse, at least reduce. That is, restrictions on low end labour arriving should appeal to anyone whingeing about that income inequality.
But back to the basic complaint here. These employers are complaining that Brexit will mean they’ve got to raise the wages they pay. To which the correct response is “Ah, Diddums”.