Global labour and the UK: On Brexit, migration, creativity, and talent

Matthew Jayes from the School of Business, Economics and Informatics discusses a recent event from the Department of Management looking at global labour and the effects of internationalism and immigration in the workplace.

L-R: Professor Michael Mainelli, James Sproule, Professor Jonathan Portes, Dr Paz Estrella Tolentino, Dr Rebecca Gumbrell-McCormick, Douglas McWilliams, Derek Bates

Birkbeck’s Department of Management hosted the second annual International Business Seminar in partnership with the Worshipful Company of World Traders on Wednesday 16 May 2018. The seminar featured speakers from academia and industry, including Chair of the event, Michael Mainelli, Executive Chairman of Z/Yen Group and Master of the Worshipful Company of World Traders. The audience ranged from Birkbeck staff, students and alumni, World Traders, policy-makers, and business representatives.

The evening opened with presentations from two renowned academics who discussed their own research related to the themes of Brexit, migration, identity and talent. Jonathan Portes, Professor of Economics and Public Policy at King’s College, London, began by summarising the current policy context surrounding the UK’s imminent withdrawal from European Union (EU). Portes, whose father migrated to the UK from the United States to join Birkbeck’s then newly-established Economics department as joint-Chair, highlighted official statistics indicating the decline in numbers of EU citizens migrating to the UK since the referendum result. In advance of the latest quarterly official migration statistics, Portes suggested he did not expect to see a significant reversal of this trend. For those who might endorse the Conservative and Unionist Party manifesto pledge to reduce net migration to the “tens of thousands” and therefore see these statistics as ‘a move in the right direction’, Portes highlighted the concern amongst businesses of access to talent and skills. Indeed, reflecting on the Chair’s opening remarks about the number of non-British EU nationals currently employed in the UK working in the Financial Technology (FinTech) sector and drawing from examples of Higher Education and Healthcare, Portes suggested this trend should be a cause for concern.

The Migration Advisory Committee was commissioned to report on the economic impact of immigration and future implications for policy, with findings due in September 2018. This report is expected to provide the evidence base for policy and debate, although amid rumours of an immigration white paper possibly being brought forward to July 2018, Portes called for a commitment to evidence-based policymaking. In 2019 then, should the UK expect an Immigration Bill to confirm the system to be adopted once its membership of the EU has ended? For Portes, this system might be similar to the one for non-EEA nationals, although there are still open questions. For example, will there be a preferential system for EU nationals (or specific EU member states)? Will there be sector-specific or regional differences? Portes suggested that there is fundamentally a division between those who would like to see a liberal system and those who wish to see greater restrictions, noting that this division is not a ‘remainer-leaver’ issue. Ending his presentation with a hint of optimism, Portes concluded that the immigration policy area is ripe for renewal and improvement, saying “there is an opportunity here if we can take it.”

Dr Rebecca Gumbrell-McCormick, Senior Lecturer in Management at Birkbeck, responded by providing a robust summary of the Trade Union response to global migration. Drawing from a selection of Portes’ published articles, her own research, and other leading voices in this field, Gumbrell-McCormick looked at broader global migration patterns and associated causes of tension. Global labour migration reacts to push and pull factors, notably the continued divergence between wages and working conditions. Focusing on the difference between Northwestern Europe and Central Eastern Europe, Gumbrell-McCormick asserted that businesses have created a demand for low wage labour deliberately through their business models. Such demand is serviceable only when there are limited or no alternatives for workers in their locale. According to Gumbrell-McCormick, the UK trade union response has demonstrated solidarity with global workers, highlighting the need for fair movement from an early stage in the debate. However, there are still concerns remaining, for example, trade unions are fighting the abuse of self-employment status by foreign workers – but also by British workers too.

The European trade union response to global migration has been more varied, with Gumbrell-McCormick highlighting the differing response to free movement from German and Austrian trade unions. One area felt to be consistent across trade unions in the UK and European counterparts was the willingness to work together with foreign worker communities, providing information, support and solidarity on matters of rights being upheld. Gumbrell-McCormick suggested that the UK trade union position on migration and free movement is largely similar to the business position, highlighting the need for trade unions to play a role of critical friend to prevent any reduction in the quality of worker rights.

First to respond to the presentations was Douglas McWilliams, Deputy Chairman, Centre for Economics and Business Research (CEBR), stating “migration is an amazingly creative but disruptive force.” For McWilliams, the UK needs the boost to creativity and dynamism afforded by those who choose to relocate for better opportunities. Indeed, for him, the UK cannot afford to reduce net migration to the tens of thousands through restricting inward movement. McWilliams challenged the audience to ponder how the impact of migration can be measured in relation to dynamism rather than net tax contributions, since he expects the former would prove much more valuable. This theme ran throughout the discussion in various forms; for example, the audience was asked by James Sproule, Member, European Advisory at L.E.K Consulting, to consider how a state might reliably measure creativity, grit, ambition, dynamism and entrepreneurialism in individuals accurately through a visa application process. The panel’s industry representatives were clear these types of attributes are those required for the future success of productivity and the UK economy.

Other themes emerged throughout the panel discussion and audience questions, the first of which asked what new steps businesses should be taking to attract and retain talent. Gumbrell-McCormick cited Birkbeck as an example of good practice, liaising with the organisation’s trade union and providing ongoing information and support for EU nationals. McWilliams suggested that the focus for business should be on providing good work, ensuring jobs are interesting and rewarding. Significantly, a lowered voice from the back of the lecture theatre could be heard to muse “Berlin has interesting jobs too.”

Professor Michael Mainelli chairs the panel discussion

As an employee of Birkbeck’s School of Business, Economics and Informatics, as well as a 2016 alumnus of the MSc Creative Industries (Management), I could not help but reflect on my personal experiences. I am also a member of the Work and Employment Policy Advisory Committee at the London Chamber of Commerce and Industry (LCCI). The LCCI published a report in November 2016, ‘Permits, Points and Visas’, prepared by McWilliams’ CEBR, which outlined a number of recommendations from the London business community following the outcome of the referendum. The panellists suggested that the context has shifted and relaxed since the report; however, the needs of the capital should not be underestimated. Portes indicated that it is highly likely controls on migrant labour will be focused not at national borders but at the workplace, with landlords and public service providers. Whilst the concept of a distributed system could be argued as more democratic than a highly centralised system, certainly concerns of small businesses around resource capacity should be considered.

Matthew Taylor, Chief Executive of the Royal Society for the Encouragement of Arts, Manufactures and Commerce (RSA), produced ‘Good Work’, an independent review of modern working practices. The relationship between good work, good living standards, and talent requires further research, especially when considering business competition for global talent. Whilst the current immigration policy context may be focused on restrictions, the speakers sounded a word of warning that the UK may not receive the desired quantity of visa applications from those it wishes to attract if there are too many restrictions in place.

For me, this also raises questions about the nature of talent and skills development. Beyond the aforementioned concern of how an administrative process may accurately measure desirable individual qualities, there appears to be the issue of temporality and lived experiences. For example, how many successful businesses emerge from chance encounters or from identifying a niche in a market one has been working in for some time (perhaps in a low-skilled role)? My experience of working on the development of Enterprise Pathways at Birkbeck allowed me to interact with many wonderful, dynamic Birkbeck students, many of whom are aiming to change careers entirely. Thus, whilst government austerity was discussed on the evening, surely the current debate around talent and migration must focus on how the UK can better develop its capacity to support citizens and migrant communities, both of which are rich sources of innovation and creativity.

The final audience question of the evening was posed by a student of business, economics and computer information systems at Georgia State University, currently undertaking an internship in London. Questioning the relationship between creativity and migration, the panel responded with their thoughts and, for some, their own experiences as migrants. McWilliams was resolute in his assertion that “changes to one’s environment and increased exposure to, or integration with, greater diversity certainly leads to better creativity.”

Portes reinforced this belief, asserting that “diversity makes us collectively better.” Certainly, this is a belief strongly held at Birkbeck and is manifest in our widening access and outreach activities, and demonstrated by our pioneering Compass Project which enables asylum seekers to have access to higher education, recognised with a major prize at the Guardian University Awards 2018.

This International Business seminar series is an important addition to the ever-present polite public debate at Birkbeck, and on behalf of staff, students and alumni, I would like to extend my gratitude to the Worshipful Company of World Traders for their ongoing support. If you are interested in attending future events at Birkbeck, please visit the events calendar.

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Driving innovation in the UK through collaboration and the Industrial Strategy

Yossie Olaleye from the School of Business, Economics and Informatics reports on a recent conference at the Birkbeck Centre for Innovation Management Research (CIMR) on the UK’s Industrial Strategy.

Innovation and technological advancement lie at the heart of industrialisation. In November 2017, the Department for Business, Energy & Industrial Strategy (BEIS) published the UK government’s Industrial Strategy White Paper, which presents a ‘modern’ long-term plan to boost productivity across the country through innovation, infrastructure development, and collaboration. The Industrial Strategy focuses on the 5 foundations of productivity – ideas, people, infrastructure, business environment, and places – and the government hopes to encourage collaboration with industry, academia, and civil society to create an economy that works for everyone.

Various questions emerged from the debate around the white paper, including how the government will support science and innovation research, and how to drive growth and local inclusion across the country. These questions formed the basis of the all-day workshop on Innovation and the UK’s Industrial Strategy hosted by Birkbeck’s Centre for Innovation Management Research (CIMR) on 23 March 2018. The event brought together a group of policymakers, including Paul Drabwell, Deputy Director of Science Research & Innovation and Dr Rosa Fernandez, Economic Adviser on Local Business Growth at BEIS, industry experts such as Professor Birgitte Andersen, CEO of Big Innovation Centre, and renowned UK academics who travelled from Kent, Oxford and Sheffield to share their latest research and comparative perspectives on the Industrial Strategy.

The objective of the workshop was to explore the trends that led to the formulation of the Industrial Strategy, and the possible outcomes of implementing the Grand Challenges outlined in the white paper, focusing on innovation, collaboration, and local partnerships. While the workshop dealt with several topics, including the impact of Brexit on achieving the strategy’s outcomes, presented by Birkbeck’s Professor Klaus Nielsen, two key themes stood out: local, regional and national engagement to deliver on economic opportunities, and driving innovation through digital skills development.

Paul Drabwell opened the workshop by emphasising the government’s commitment to increase R&D spending to 2.4% of GDP by 2027. He said that the UK “has world-leading science research, excellent universities, and innovative companies,” and it is these strengths that will drive the implementation of the strategy. Increased R&D funding will enable UK universities to continue to excel in international league tables, collaborate more with industry partners, and encourage innovation across the country, a theme which runs throughout the Industrial Strategy. Despite the UK’s strengths, Paul Drabwell noted that there are issues around local engagement in the country, which means that there is a crucial need to drive productivity and maintain a high level of employment. This is a challenge the government hopes to resolve through the £1.7 billion Transforming Cities Fund to improve intra-city transport links and promote local growth within city regions. Dr Rosa Fernandez expanded on this point with a presentation on the role of place in the Industrial Strategy, highlighting that the UK government intends to build on local strengths to tackle the issue of poor distribution of economic activity across the country.

A key question at the workshop was the role of research and the UK’s academic institutions in delivering the possible outcomes of the Industrial Strategy. We heard from Dr Keith Smith at Imperial College London who discussed the need for multinational collaboration to deal with innovation challenges across different industries, and Birkbeck’s Professor Helen Lawton Smith who presented research on the importance of local enterprise partnerships (LEPs) in addressing the challenge of regional inequality in the country. Professor Jeremy Howells from the University of Kent and Professor Tim Vorley from the University of Sheffield focused their presentations on the potential for business schools to convene and work with other social science schools to create solutions for the challenges of productivity and job creation discussed in the white paper.

The takeaway from this workshop was that collaboration – from government, industry, universities, and local communities – is essential if we are to achieve the ambitious objectives of the Industrial Strategy, as well as greater investment in research and innovation to support skills development.

One notable example of such collaboration is the Institute of Coding (IoC), which was announced by Prime Minister Theresa May at the World Economic Forum 2018. Birkbeck is a partner in a consortium of over 60 universities, businesses such as IBM and Microsoft, and professional bodies, to tackle the digital skills gap in the UK through the IoC. By bringing together such diverse perspectives, the CIMR workshop stimulated debate and provided useful suggestions for how academics can work effectively with business leaders and the government to drive innovation in the UK through research collaboration and meaningful partnerships.

Many thanks to all who participated and attended the workshop.

Organisers: Professor Helen Lawton Smith, Professor Klaus Nielsen, Professor Jeremy Howells, and Dr Rupert Waters.

Further speakers:

  • Professor Sharmistha Bagchi-Sen, State University of New York
  • Professor Åsa Lindholm Dahlstrand, Lund University
  • Dr Alexander Grous, London School of Economics and Political Science
  • Dr Carl Hunter, CEO & Managing Director, Coltraco Ultrasonics Limited
  • Professor Ewart Keep, SKOPE, Oxford University Skills
  • Professor Slavo Radosevic, University College London
  • Professor Roy Sandbach, Northumbria University

Further information:

 

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Birkbeck’s day out with the London Venture Crawl

Jenna Davies leads the extracurricular Enterprise activities at Birkbeck and recently took a group of students on the London Venture Crawl, an event aimed at connecting them with businesses and experts.

Wednesday 14 March saw a group of entrepreneurial students from Birkbeck join an event that was unlike any other; six double-decker buses, nine London Universities and over 200 students made up the London Venture Crawl and celebrated everything the city offers to budding entrepreneurs.

Birkbeck teamed up with University of the Arts and the University of East London and transported students to a range of enterprising spaces around the capital to inspire them to pursue their start-up ventures, meet successful entrepreneurs along the way and ultimately check out a snapshot of what London offers on the start-up scene.

The day started bright and early with students ready for the first stop of the day at Campus London, a Google space in Shoreditch. Hearing from Creative Entrepreneurs, an innovative community of creative individuals, the group woke up and boarded the double decker bus that was to be their mode of transport for the day.

On board, they were greeted by serial social entrepreneur Benjamin Western, Co-Founder of Gaggle and indiGO Volunteers to pump them up for the rest of the journey.

The second stop was at Amazon Fashion, catering nicely for the group as they got an insight into the impressive warehouse where all of Amazon’s fashion items go for checking, photographing and packing. A panel discussion with the top operators gave a glimpse into life at the leading online retailer.

Third stop of the day took the group to Grant Thornton, after hearing from their Head of Growth Finance, Sarah Abrahams. Lunch was served and the students met Crate Brewery Founder Tom Seaton who shared his story starting up Hackney’s well-known venue.

The venture continued on to Hello Fresh, the extremely impressive and relatively new organisation that saw its revenues grow from €2.3m in 2012 to €304m in 2015 – here the students met some of the key players at their London hub and toured the quirky space.

The penultimate stop for the group was Innovation Warehouse, a co-working space and community for digital high-growth start-ups. The students were able to hear from the founder Ami Shpiro along with some of the entrepreneurs within the community.

The final stop brought all six buses together where students from across the nine universities to could network over a pizza and beverage while hearing from the inspiring Lawrence Kemball-Cook, founder and CEO of Pavegen, as well as take part in the cross-bus pitching competition. Birkbeck stormed through to the final, with Business Innovation student Bobette Kenge rounding off the day on a high and ending what was an extremely eventful, inspiring event for everyone involved.

Birkbeck Business & French student Jennifer said: “The Plexal building was fantastic, the talk at Grant Thornton with the Founder of Crate Brewery was great and gave an insight into the different types of investments, investors and how it all works, and Amazon Fashion was heaven to me! I would love to come to a similar event again and meet more people.”

This was an incredible opportunity for our students to network with a huge range of fellow London students, plus receive invaluable advice from the speakers throughout the day. The energetic atmosphere lasted right to the end of the day and was fantastic to see.

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Fixing the economy: rebuilding macroeconomics

First year BSc Economics student Lydia Evans provides a recap of an event organised by Birkbeck’s Economics + Finance Society, at which Dr Angus Armstrong introduced the new research network he directs.

The story is infamous: the Queen visits the London School of Economics and asks why no one saw the recent global financial crisis coming. Angus Armstrong believes that it’s not that people didn’t see a catastrophe on the horizon, “it’s that the institutions almost didn’t want to listen to them”. Raghuram Rajan, Joseph Stiglitz and others attempted to warn the world that a seismic shock was going to take place. The main question is how have we moved forward? Armstrong thinks that the financial world has not, it continues to choose willful ignorance. He directs a new network that wants to re-evaluate the entrenched economic models and the collective consciousness of those who use them.

Rebuilding Macroeconomics, a network of economists and academics, are attempting research that is disruptive, not immune to failure but genuinely independent to ask uncomfortable questions. The key to the efficacy of this research is how it is sourced. The network’s blueprint is set out as three tributaries: Discovery Meetings, Research Hubs, and Pilot Projects. Discovery Meetings are notable for their inclusivity. They seek to attract people from all backgrounds to discuss the most important macroeconomic questions. These discussions lead to fresh insights and methodologies to be examined by policy-makers and scholars in the Research Hubs. The most promising ideas turn into pilot projects. The network is funded by the Economic and Social Research Council and hosted by the National Institute of Economic and Social Research.

Does the UK really need such reformatory research? He finds something “profoundly wrong” when a country as rich as the UK requires food banks to feed some of its population. Government debt is 90% of GDP. The Bank of England is only able to claim pyrrhic victories. It may hit its inflation target but other economic measures are in turmoil. Mark Carney has himself confessed that 95% of the movement in interest rates is determined by international events.  Current interest rates may not be what the UK actually needs them to be. Armstrong feels that the established institutions are reliant upon Knut Wicksell’s Rocking Horse. Whatever the instability, the assumption is that the status quo will always return. This is no longer the reality and nothing has been done about it. The failure is intellectual, not regulatory, and economists must be brave enough to confront the zeitgeist.

When Armstrong returned from study in America and expressed his wish to research financial crises, he was told that these were a problem only for the developing world. He mentions a new paper in the Journal of Economic Perspectives, considering how those who disagree with the mainstream in Economics are labelled dilettantes. Is the discipline consumed by an ill-conceived adherence to orthodoxy? Not all new ideas are worthy but it’s difficult to ignore a belligerent spirit against outliers. Whatever the future holds, Armstrong is not alone in arguing that the existing economic paradigm must urgently be confronted.

Further information

 

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