Time to say goodbye: Brexit, employment and the hospitality sector

The UK hospitality sector looks set to be the most affected in terms of economic growth and employment rate after Brexit. BSc Financial Economics student Guglielmo Polizzotto explores where the sector stands now.

According to the Office for National Statistics (ONS), the number of people in work in the UK is over 30 million, with 5.44% of those in hospitality. Between 2016 and 2019, the number of people in work grew by 3.31%, but in hospitality the proportion of workers shrank by 0.04%. In Figure 1, we can appreciate that the difference between hospitality and other industries has been minimal in terms of numbers of employees. To have a better understanding, a look to the employment vacancies is needed.

Graph showing employment in the UK by industry

A 2017 study by People 1st established that strict government conditions of employment for migrants could be the reason why many restaurants and hotels are struggling to fill their vacancies. The UK government asks for certain prerequisites to grant EU migrants access to employment, such as a pre-existing offer of work from the Home Office and a salary of above £25,600.

An average hospitality worker’s salary stands between £17,000 and £21,000, which makes it difficult for any EU worker who would like to work in the UK. So why could this be an issue for the hospitality industry?

The hospitality sector has the highest vacancy rate compared to other industries in the UK, reaching a peak of four vacancies per 100 people in the past five years. One of the reasons behind these high vacancy rates is that certain positions are considered hard to fill.

Over the last few years, the UK has faced a demographic change, which has seen fewer young people join the labour market and caused a shrink in the pool from which any restaurant or business in the hospitality sector was filling certain positions. Migrants were the solution to this problem; many seasonal or long-term workers are employed to cover those positions which could not be filled by the local workforce.

Graph showing vacancy rate in the UK

EU workers have a great impact on those positions considered hard to fill. Immigrants make up 20% of the hospitality workforce and about 70% of these come from EU countries. In a countrGraph showing percentage of EU employees in the UK hospitality sectory with a population of over 65 million, it feels absurd that a few hundred thousand fewer workers would create such a problem for the UK labour market. In fact, the issue is more localized than it seems.

 

 

Graph showing UK employees in hospitality by region.London and the East Midlands have the highest number of employees in hospitality and almost half of them come from EU countries. In a situation where the number of vacancies is rising, but the pool from which businesses fill their positions is shrinking, it will become harder to find employees in certain areas of the UK. Businesses (who can afford it) will be forced to increase salaries to make jobs more appetising or share the tasks between fewer people and leave certain positions unfilled, which can cause distress and decrease the quality of the job done.

The time to say goodbye to the EU has come, and while the impact on the workforce looks set to be dramatic, the UK is facing another challenge. With decreasing tourism, and fewer people coming to the UK for work reasons, the labour market is impoverished of its cultural mark that made our beloved country unique.

This blog was originally written as an assignment for the Quantitative Techniques in Applied Economics Module.

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Trump and Brexit: why it’s again NOT the economy, stupid

This post was written by Professor Eric Kaufmann from Birkbeck’s Department of Politics. It was originally published on the LSE British Politics and Policy blog

As the final votes are counted, pundits and pollsters sit stunned as Donald J. Trump gets set to enter the White House. For anyone in Britain, there is a sharp tang of déjà vu in the air: this feels like the morning after the Brexit vote all over again. Eric Kaufmann explains that, as with Brexit, there’s little evidence that the vote had much to do with personal economic circumstances.

For months, commentators have flocked to diagnose the ills that have supposedly propelled Trump’s support, from the Republican primaries until now. As in Britain, many have settled on a ‘left behind’ narrative – that it is the poor, white, working-class losers from globalization that have put Trump over the top. Only a few clairvoyants – Michael Lind, Jonathan Haidt – have seen through the stereotypes.

But, as in Britain, there’s precious little evidence this vote had much to do with personal economic circumstances. Let’s look at Trump voting among white Americans from a Birkbeck College/Policy Exchange/YouGov survey I commissioned in late August. Look at the horizontal axis running along the bottom of figure 1. In the graph I have controlled for age, education and gender, with errors clustered on states. The average white American support for Trump on a 0-10 scale in the survey is 4.29.

You can see the two Trump support lines are higher among those at the highest end of the income scale (4) than the lowest (1). This is not, however, statistically significant. What is significant is the gap between the red and blue lines. A full two points in Trump support around a mean of 4.29. This huge spread reflects the difference between two groups of people giving different answers to a highly innocuous question: ‘Is it more important for a child to be considerate or well-mannered?’ The answers sound almost identical, but social psychologists know that ‘considerate’ taps other-directed emotions while ‘well-mannered’ is about respect for authority.

People’s answer to this question matters for Trump support because it taps into a cultural worldview sometimes known as Right-Wing Authoritarianism (RWA). Rather than RWA, which is a loaded term, I would prefer to characterise this as the difference between those who prefer order and those who seek novelty. Social psychologist Karen Stenner presciently wrote that diversity and difference tends to alarm right-wing authoritarians, who seek order and stability. This, and not class, is what cuts the electoral pie in many western countries these days. Income and material circumstances, as a recent review of research on immigration attitudes suggests, is not especially important for understanding right-wing populism.

Figure 1.

1

Now look at the same graph in figure 2 with exactly the same questions and controls, fielded on the same day, in Britain. The only difference is that we are substituting people’s reported Brexit vote for Trump support. This time the income slope runs the other way, with poorer White British respondents more likely to be Brexiteers than the wealthy. But income is, once again, not statistically significant. What counts is the same chasm between people who answered that it was important for children to be well-mannered or considerate. In the case of Brexit vote among White Britons, this represents a 25-point difference around a mean of 45.8 per cent (the survey undersamples Brexiteers but this does not affect this kind of analysis). When it comes to Brexit or Trump, think successful plumber, not starving artist or temporary lecturer.

Figure 2.

2

Some might say that even though these populist voters aren’t poor, they really, actually, surely, naturally, are concerned about their economic welfare. Well, let’s take a look at the top concerns of Trump voters in figure 3. I’ve plotted the issues where there are the biggest differences between Trump supporters and detractors on the left-hand side. We can start with inequality. Is this REALLY the driving force behind the Trump vote – all that talk about unemployment, opioid addiction and suicide? Hardly. Nearly 40 per cent of those who gave Trump 0 out of 10 (blue bar) said inequality was the #1 issue facing America. Among folks rating the Donald 10 out of 10, only 4 per cent agreed. That’s a tenfold difference. Now look at immigration: top issue for 25 per cent of white Trump backers but hardly even registering among Trump detractors. Compared to immigration, even the gap between those concerned about terrorism, around 2:1, is not very striking.

Figure 3.

3For Brexit vote, shown in figure 4, the story is much the same, with a few wrinkles. The gap on immigration and inequality is enormous. The one difference is on ‘the economy in general,’ which Trump supporters worry about more than Brexiteers. This could be because in the graph above I am comparing extreme Trump backers with extreme detractors whereas the Brexit-Bremain numbers include all voters. Still, what jumps out is how much more important immigration is for populist voters than inequality.

Figure 4.

4Why is Trump, Brexit, Höfer, Le Pen and Wilders happening now? Immigration and ethnic change. This is unsettling that portion of the white electorate that prefers cultural order over change.

The US was about 90 percent white in 1960, is 63 percent white today and over half of American babies are now from ethnic minorities. Most white Americans already think they are in the minority, and many are beginning to vote in a more ethnopolitical way. The last time the share of foreign born in America reached current levels, immigration restrictionist sentiment was off the charts and the Ku Klux Klan had 6 million members – mainly in northern states concerned about Catholic immigration.

Ethnic change can happen nationally or locally, and it matters in both Britain and America. Figure 5, which includes a series of demographic and area controls, looks at the rate of Latino increase in a white American survey respondent’s ZIP code (average population around 30,000 in this data). The share of white Americans rating Trump 10 out of 10 rises from just over 25 percent in locales with no ethnic change to almost 70 percent in places with a 30-point increase in Latino population.

The town of Arcadia in Wisconsin – fittingly a state that has flipped to Trump – profiled in a recent Wall Street Journal article, shows what can happen. Thomas Vicino has chronicled the phenomenon in other towns, such as Farmer’s Branch, Texas or Carpentersville, Illinois. There are very few ZIP codes that have seen change on this scale, hence the small sample and wide error bars toward the right. Still, this confirms what virtually all the academic research shows: rapid ethnic change leads to an increase in anti-immigration sentiment and populism, even if this subsequently fades. The news also spreads and can shape the wider climate of public opinion, even in places untouched by immigration.

Figure 5.

5Now let’s look in figure 6 at Brexit, and how White British voters in wards with fast East European growth in the 2000s voted. With similar controls, it’s the same story: when we control for the level of minorities in a ward, local ethnic change is linked with a much higher rate of Brexit voting. From under 40 percent in places with no ethnic change to over 60 percent voting Brexit in the fastest changing areas. Think Boston in Lincolnshire, which had the strongest Brexit vote in the country and where the share of East Europeans jumped from essentially zero in 2001 to the highest in the country by 2011.

Figure 6.

6

The Trump and Brexit votes are the opening shots which define a new political era in which the values divide between voters – especially among whites – is the main axis of politics. In a period of rapid ethnic change, this cleavage separates those who prefer cultural continuity and order from novelty-seekers open to diversity. Policymakers and pundits should face this instead of imagining that old remedies – schools, hospitals, jobs – will put the populist genie back in the bottle.

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Trenton Oldfield’s win is a defeat for Theresa May’s deportation policy

Nadine-El-EnanyThis post was contributed by Dr Nadine El-Enany, a lecturer in Birkbeck’s School of Law. It was originally published on The Guardian’s Comment is Free.

On Monday 9 December, Trenton Oldfield won his appeal against Theresa May’s decision to deport him to Australia after he carried out a direct action protest against elitism at the Oxford Cambridge boat race in 2012. The home secretary had deemed Oldfield’s presence in the UK to be “undesirable” and “not conducive to the public good” after he was convicted of causing a public nuisance when he swam into the Thames and disrupted the boat race last year. Oldfield’s win is not only a victory for the right to protest, but a serious defeat for May’s deportation policy.

May had delivered a tub-thumping speech to Tory party members at their September conference in which she promised to “deport foreign criminals first, then hear their appeals”. In spite of this, at yesterday’s tribunal the Home Office’s legal representative did not seem to be trying very hard to win the case. He asked few questions of Oldfield and his wife, Deepa Naik, and chose not to quiz the witnesses at all. He presented little evidence, basing his entire case on the fact that Oldfield had carried out a direct action protest. It seemed the Home Office expected to lose. Was this a U-turn in disguise?

May should never have taken the decision to deport Oldfield. In cases of foreigners who serve sentences of less than 12 months, the home secretary has the discretion to order deportation if she considers it to be “in the public interest”. Oldfield’s crime was to carry out a peaceful direct action protest in the name of equality. At his tribunal hearing, he spoke of how he had not expected to have been dealt with so harshly by the state. Britain, he believed, was a “mature democracy”, which this year commemorated 100 years since Emily Davison staged her final protest calling for women’s suffrage at the Epsom Derby, where she was trampled by King George V’s horse. But the historical tradition that May seems to be following is a quite different one: Britain’s shameful history of deporting political activists to Australia – the Tolpuddle Martyrs in 1834, the Chartists in 1842 and the Fenians in 1868, to name but a few.

The state’s reaction to Oldfield’s protest is one of a long list of the coalition government’s repressive responses to dissent. Recall the police brutality and criminalisation with which students were met when they resisted the tripling of student fees three years ago; scenes which were replayed on campuses last week when students staged “cops off campus” protests following the violent eviction of a student occupation calling for an end to the marketisation of education.

Oldfield and his wife have lived through months of anxiety, facing the possibility that their family, including their five-month-old daughter, could be separated from each other. This anguish is felt by thousands of migrants forcibly removed from Britain every year. Addressing the press following his victory, Oldfield called for attention to be focused on all the other migrants “going through the same process”. Most deportees do not have the cultural capital and support network from which he, as a white middle class man, has benefitted.

Consider the case of Luqman Onikosi, an anti-racist activist who suffers from hepatitis B and is under threat of deportation to Nigeria, where he will be unable to access treatment. Or Isa Muaza, for whom May ordered an “end of life” plan be drawn up after he went on hunger strike for 100 days in protest at his deportation to Nigeria. Despite being so ill that he had to be carried out of Harmondsworth immigration removal centre in order to be deported, May refused to back down. As a result of his protest, Muaza’s case has attracted the support of MPs, the public and celebrities. The home secretary no doubt fears that other migrants in seemingly powerless positions will be similarly inspired to resist deportation through protest.

In carrying out his protest against elitism, Oldfield focused on a symbolic site: the Oxford-Cambridge boat race. In winning his appeal, he succeeded in disrupting something weightier and more sinister: the attempt by May – herself an Oxford alumnus – to use his case to send a message of deterrence to migrants who might consider engaging in political protest.

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