Take the euro, for example. It has greatly favoured already wealthy Germany and its export industries at the expense of southern Europe. The euro has meant serious unemployment for millions of young Greeks, Portuguese, Spaniards and Italians and has produced political extremism. The EU is also working well for big banks. The bailouts being financed by extreme levels of austerity in countries like Greece have largely benefited financial institutions that lent irresponsibly before the crash. The EU is also working for big corporates that benefit from mass immigration. Businesses that have under-invested for decades in the productivity and training of their own and local workforces have no reason to mend their ways so long as cheap labour can be imported from abroad.
But if the EU is working for Germany, for banks, for big corporates and for the public affairs companies with large lobbying operations in Brussels, the EU isn’t working for over regulated small businesses and lower-paid and lower-skilled Britons. They now have to compete with millions of people from abroad for jobs and a wage rise. The Government’s own Migration Advisory Committee reported that for every 100 migrants employed twenty three UK born workers would have been displaced.
He warned of an “explosion of have-nots” and an increasing divide between “people who benefit from the immigration of cheap nannies and baristas and labourers – and people who can’t find work because of uncontrolled immigration”.
The construction of the Olympic Park was a powerful illustration of the way in which immigrants undercut UK workers through their willingness to endure family-unfriendly living conditions. Visiting job centres in East London at the time I met both skilled and unskilled workers who struggled to get work on the site. When I asked why they said that people from Eastern Europe, often living in bedsits, without UK housing and family costs, hugely underbid them for their work. Since then those stories have been borne out by the facts. Despite the all the statements about the Olympic Park helping British workers, we now know that nearly half of all the jobs on the site went to foreign nationals.
Stuart Rose of the Stronger In campaign has admitted that immigration cuts the pay of the poor in a rare moment of candour – and acknowledged that wages will go up for many Britons if immigration is restricted.
The downward pressure on wages is a trend will only get worse if we continue to have open borders with the EU – and would get most difficult in a recession. A Bank of England study in December 2015 concluded: ‘the biggest effect is in the semi/unskilled services sector, where a 10 percentage point rise in the proportion of immigrants is associated with a 2 percent reduction in pay’
Given this evidence, I find the Labour Party’s current position ironic. As Frank Field has pointed out, in saying they are now in favour of staying in the EU they are acting against the interests of the communities they purport to serve.