Latest migration statistics – the impact on the food industry
30 November 2023New data from ONS shows that 1,180,000 people migrated to the UK in the year ending June 2023, with 508,000 emigrating.1
Net inward migration (i.e. number of immigrants less number of emigrants) was therefore 672,000 - a significant increase over historic norms.
The ONS has also updated its estimate for net immigration for the full year 2022 up to 745,000. This is over three times the pre-pandemic level.
Net immigration is now far more powerful as a driver of UK population growth than “natural change” (i.e. births less deaths).
Inward migration was driven by rising numbers of non-EU nationals, offsetting net emigration by UK and EU nationals.
Increasing numbers of non-EU nationals came to the UK to work (especially health and social care) and/or to study. There were also an increasing number who came to the UK for humanitarian reasons (either as principal visa applicants or as dependents).
Last week, The Office for Budget Responsibility forecast that net migration will fall from the current high levels. This is due to the temporary nature of this migration spike (students and humanitarian routes) and taking into account of government policy to tighten the migration regime.
IGD Viewpoint
In some ways, rapid population expansion might be seen as positive by food and grocery businesses, since it represents an expansion of the customer base and higher volume demand.
This is likely to be welcome in a mature market such as the UK, where low economic growth makes it difficult for all operators to thrive simultaneously.
Population growth also helps to drive economic growth (more people means more economic transactions) and tax receipts (more people create more opportunities for taxation).
On the downside, however, rapid population growth can create pressure on productive resources (e.g. soil and water) and increases pressure on government services (e.g. road networks and schools).
Currently, “worker” visas focus on high-pay, high-skill roles or roles with skills recognised officially as being in especially short supply (e.g. care workers).
The current migration regime does not support many food and grocery businesses, which are keen to recruit workers for entry-level (i.e. lower-pay) roles or those not on the “shortage occupation” list.
The Independent Review into Labour Shortages in the Food Supply Chain made clear that “it is of vital importance that the government widens the eligibility criteria for the skilled worker visa route”.
The government is expected to provide its response to the Independent Review in the coming weeks.
So, food and grocery businesses may well see new data as offering both good and bad news – good news in the form of more customers to serve, but bad news since there will be no more workers to meet that demand.
1 Data is for long-term migrants only, excluding short visits.