Socialist Worker

After new pay figures released - bosses, not migrants, are to blame for lower wages

Right wingers have seized on figures for agricultural wages and immigration to say that migrants lead to lower wages. Alistair Farrow looks at the reality

Issue No. 2590

The Tories try to blame migrants for low pay - but many people defend migrants rights to be here

The Tories try to blame migrants for low pay - but many people defend migrants' rights to be here (Pic: Guy Smallman)


Migration does not push down wages—bosses and the Tories do. Yet politicians and some trade union leaders present the idea as if it were obvious.

Some on the right use tenuous links to try and back up their claims.The latest is an apparent rise in agricultural wages since the vote to leave the European Union in June 2016.

An NFU farmers’ organisation survey last October showed that there was a 29 percent seasonal labour shortfall in September of last year. 

Some in the trade union movement have argued that the first fact caused the second—and that this proves that migrants drive down wages.

But just because one thing follows another, doesn’t mean that one was caused by the other.

Agricultural wages have been rising since 2014—before the EU referendum. So it’s not true that migrant workers leaving Britain caused the rise.

But the rise has also been tiny, and when it’s broken down into sub-sectors the figures are even more alarming. 

The argument relies on assumptions involved in supply and demand economics. This says that a lack of supply of a commodity, in this case labour, will push up demand for it and its value.

As Unite union general secretary Len McCluskey has said, “Supply and demand affects the sale of labour, pitting worker against worker.”

He has also said that immigration from countries with “vast historical differences in wage rates” has created “sustained pressure on living standards” in Britain. But this ignores the reality in which markets are rigged and can be altered.

Determined

Wages are determined by a myriad of social factors. 

For instance in Britain nursing wages are stagnant despite a huge shortage of workers. It’s government policy that holds them down. 

A key factor in determining wages is the combativity of the working class—but unions have repeatedly backed down from a serious challenge to employers over wages.

It’s the Tories and bosses, not migrants, who have driven down wages and conditions for agricultural workers.

The Tories abolished the Agricultural Wages Board (AWB) in 2013. The board set minimum conditions and rates of pay for some 140,000 agricultural workers.

A year after the board was abolished, 44 percent of workers surveyed by the Unite union reported not having received a pay rise. 

Other respondents said that sick pay had been cancelled or that they had to work more hours before overtime entitlements began.

As a 2017 TUC article argued, “Cutting immigration won’t tackle low wages in the agriculture sector because immigration isn’t the problem.” 

Bosses pay low wages because they know they can get away with it.

When politicians blame anyone other than the bosses it’s because they don’t want to take them on. 

The left needs to organise and fight alongside migrant workers to raise pay for all workers—and defend freedom of movement.


Real terms pay cut for all

The latest Office for National Statistics figures show that wage growth has remained steady at around 2.5 percent since before the vote to leave the EU.

That’s below the Retail Price Index (RPI) rate of inflation, which stood at 4.1 percent in December.  

RPI takes housing costs into account. This is why Bank of England boss Mark Carney wants to get rid of it, claiming it “has no merit”.

But even the bosses’ preferred inflation measure, the Consumer Prices Index, stood at 3.1 percent in December.

So whichever measure is used, wages have been falling in real terms.

It’s significant that health unions have put in a 3.9 percent pay claim to bosses.  

And in local government the Unison national joint committee has voted against a 2 percent pay offer.

Arguing that migrants bring down pay plays into the hands of bosses who underpay workers wherever they are from.

To get real pay rises will take action.


A8 migration is positive

A group of countries known as the A8 joined the EU as part of an enlargement in 2004.

They are the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia.

One study looked at data between May and December 2004 to analyse the impact of workers from these countries on the British economy.

It found that the main impact of A8 migration was “to increase output and total employment, with minimal impact on native workers”.

Researchers didn’t rule out an association between the low growth in wages and the increase in employment of workers from the A8 countries.

But it said “the nature of any link is unclear”.

And the overall economic impact of immigration from the A8 countries had been “modest, but broadly positive”.

By far the most significant changes were seen in agriculture and fishing.

“Employment appears to have grown sharply as a result of accession worker migration,” the study said.

Evidence that growth in nominal wages in these sectors may have been reduced was “mixed”.


Don’t pander to the right wing

Unfortunately, some on the left accept the argument that immigration leads to lower wages for workers born in Britain.

Labour leader Jeremy Corbyn often speaks in defence of migrants and rightly blames the Tories and bosses for low pay.

But last week he warned against the threat of “wholesale groups of workers brought in to undercut and undermine”.

His comments risk letting the real culprits off the hook.


Workers make profits possible

Environment secretary Michael Gove told agricultural bosses last month to introduce industrial production methods or go under.

Economist Ben Brettell has also said that “new technology” is “weakening workers’ bargaining power”.

But bosses profit from exploiting workers.

Whether they are picking fruit or building robots to pick fruit, that relationship will remain central to capitalism.


Migrants may push pay up

Research based on four reports commissioned by the Home Office in 2003 found that immigration has “if anything, a positive effect on the wages of the existing population”.


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