Recent data reveals almost a quarter of the best paid people in the UK are migrants. Analysis of anonymised tax returns collected by HM Revenue and Customs revealed 24 per cent of the 5,25,000 people in the top 1 per cent each earning more than £1,28,000 moved to the UK as adults. The research was conducted by academics at the University of Warwick.
Lead author of the paper titled 'Importing inequality: Immigration and the Top 1%', Arun Advani said the research suggested that people who were concerned that migration was a drain on the economy were not considering the impact of high earners moving to the UK.
Assistant professor at the Warwick's economics department and director of Cage, Advani said, “A lot of the worries about the bottom end of the distribution. But, actually migrants are hugely prevalent at the top of the income distribution, and therefore paying more tax.” In the top 0.001 per cent of UK-based earners almost four in 10 are immigrants; almost three times as many that would be expected if incomes were distributed evenly. In among low-income groups, only about one in six people are migrants.
Advani said he suspected prior to the research that migrants would be over-represented among high earners as many non-UK born people work in finance, technology and medicine. However, he was shocked at the scale of the imbalance. He said, “I was genuinely surprised, and we spent a long time convincing ourselves that we weren't screwing it up. But we checked and triple-checked it and it was correct.”
He added, “People may not think of 'migrants' as being rich. But if you stop and think who the wealthy people hanging out in Mayfair are, a lot of them are not UK-born. Or if you go to Canary Wharf you will hear a lot of voices in European languages because people come here for well-paying jobs.” The research goes on to show that the number of well-paid migrants has been growing fast. “There are 52 per cent more migrants in the top 1 per cent in 2019 than in 1997, and more than twice as many in the top 0.01 per cent. Almost all of the growth in the UK top 1 per cent income share over the past 20 years can be attributed to migration.”
The data also shows that four in 10 of the best-paid bankers are migrants, and they earn an average of £3,83,300 before tax. Just under 40 per cent of the highest-paid people working at UK hospitals are migrants, earning an average of £1,60,400. In web portal work 51 per cent of the best-paid people are migrants and they earn £2,59,700 on average. Advani said the research could prove important as politicians debate the introduction of a “wealth tax” on the highest-earning people to help pay for the recovery from the coronavirus pandemic.
