Saturday, September 15, 2007

Imperial cities, global cities at a time of change

Monday this week (16 September 2007) there was a very interesting article by James Button in the Sydney Morning Herald, Winds of change create a very different Britain, that created a focus for a number of things that I have been thinking about.

James's opening paragraph reads:

A huge experiment is under way in Britain, one not all the locals like, though it seems to be doing many of them good. It is the transformation of the country into one of the most open, globalised nations in the world.

Now I do not think that James is necessarily right here for reasons that I will explain in a moment. But first his analysis.

Migration and Demographic Change

James begins by pointing to British migration statistics, statistics that I found quite fascinating because of the scale.

Last year, a record 574,000 people moved to Britain, nearly 1 per cent of the population. Australia, by contrast, took a bit over 130,000 migrants - 0.65 per cent of its population. These numbers do not count the 600,000 workers from Eastern Europe who have arrived since 2004.

This immigration is offset to a degree by record emigration. Last year, a reported 385,000 people left the country for good. One in ten Britons now lives abroad, a figure twice as large proportionally as the Australian equivalent. Nearly 700,000 Britons live in France, 800,000 in Spain, 1.3 million in Australia.

Migration and emigration together suggest a net gain of 189,000. Then there are the many short term workers entering the country adding to the population movements. To put these figures in full perspective, in 2005-2006 there were 131,593 migrants to Australia, 63,740 Australians migrated, for a net gain of 63,740. I do not have figures for those on working visas.

If we dig below the raw data for the UK, we find a number of interesting trends.

The British economy has been growing rapidly. In 1997, British per capita GDP (Gross Domestic Product) was the lowest in the G7, now G8. Today it is second. This growth makes it a magnet for migrants, especially from Eastern Europe.

But, and as evidenced by the posts on the demography matters blog, Europe in general, Eastern Europe in particular, has an aging population. This has led to competition for workers.

In Poland, somewhere between one and two million mainly young, well educated workers have left the country in the recent past. To meet resulting labour shortages - the Ministry of Labor estimates that the country needs 500,000 foreign workers annually to meet labor demand gaps - the Polish government is facilitating entry in the country for immigrant workers from Ukraine, Russia and Belarus. But these countries have their own problems.

The population of the Ukraine has been in decline since 1992. The Ukranian economy has been growing quite rapidly, so there are labor shortages. Russia, too, is experiencing population decline and is targeting worked from both the CIS and former communist states.

Without going into a full demographic analysis, underlying James Button's story is a complex pattern of mass migration with winners and losers. The UK is a winner. Poland and Ukraine are losers, as is Germany which faces population decline marked by migration of the educated young, part offset by major intake of guest workers.

The Rise of London

James Button talks about winds of change brought about by economic liberalisation creating a very different Britain, an open globalised nation. This is deceptive. We should really be talking about the rise of London for, as James also notes, London is becoming a kind of city state. Sydney is the Australian equivalent.

London, like Rome before it, has long been an imperial city drawing wealth not just from the Brittish Isles, but also from what was a vast empire. When I was born, London's population was greater than all of Australia.

London retains it's imperial position. But now the city is morphing into something more akin to Venice, a city that draws its wealth from commerce independent of the ruled hinterland. In some ways, there are now two UK's, London and the rest.

According to James Button, over the next ten years, 80 per cent of immigrants to the UK are expected to go to London, where a third of the population is already non-white. By contrast, the figure in the rest of the country is only about 8 per cent, about the same as the Australian average.

Just as has already happened in to some degree in New Zealand with Auckland, London will become a very different entity from the rest of the country. I suppose that you could say that that has always been the case at one level. However, there has always been a cultural and historical continuity that is likely to survive, at best, in an attenuated form.

Lessons for Australia

Those who read this blog will know that I am not worried at a personal level by ethnic diversity. Far from it.

But I am fascinated by what the change process means for our future.

At present, and to a degree by luck, Australia is still in the same position as the UK in its immediate region.

In an aging world of increasing mobility and competition for the best people, Australia can still attract people. But that attraction is, I think, declining.

Further, and as is happening in many countries in Europe, the proportion of young, bright, Australians leaving continues to increase. While, as James Button says, the proportion of Australians living abroad is lower than the UK, it is increasing at a fast rate.

Again as is happening in Europe, we are increasingly dependent upon migrant workers to fill gaps. I think that this will continue to increase.

But while I can plot things on straight statistical trends, I cannot say what the actual outcome will be. I suppose my best guess at present would be this.

In a world of global cities, I think that Sydney is our one chance of a global city. Sydney is already different from the rest of the country, and will become more so. This will happen anyway.

But what I don't know is whether that city can be more than a regional centre, an Auckland to Australia, but small in importance on a global scale.

In a world of global people movements, we know that the Pacific, Chinese, Indian and ASEAN influence will increase. We do not know whether Australia can retain sufficient drawing power to get its share of the best people in the global village. My best guess would be yes, but that is as much a hope as a rational aspiration.

So in all this, I do not know. But my thanks to James Button for extending my thinking.


Lexcen said...

Those who revel in PC thinking will celebrate the growing trend of multiculturalism. What I see is in fact an increasing number of cultural enclaves because immigrants do tend to cluster into communities. This is the current trend. What the future outcomes of all this will be is yet to be seen.

Jim Belshaw said...

I think that you are right, Lexcen, but only partially right.

Clare's party showed ethnic mixing. But these were kids from middle class backgrounds.

To my mind, the real problem lies in guest workers. If we build an underclass of ethnically different people, then we have a problem.

PC makes it difficult to discuss this issue. I support guest workers. But we need to be able to discuss how to fit them into the broader community.

Anonymous said...

Jim, I don't agree with your "winners and losers" choices here. If you're defining "winners" as countries that attract young workers from elsewhere, then of course by that definition the UK is a winner and a major attractor of labour. But so is Germany-- you mistakenly put Germany into the losers category, but in fact Germany now has the highest foreign-born population of any country in Europe. Germany has been having no trouble attracting foreign workers from Eastern Europe, which it's been doing for over a decade, well before the Poland/Czech/Slovak bloc got into the EU. (In fact, Germany refused to fling open its doors in general to Polish workers because it *already* has a system in place to bring in hundreds of thousands of Poles and integrate them quickly into the German economy.)

I found that out to my surprise when working a stint in Germany about a year ago, the place is basically a marketplace for the Eastern European workforce. (German is still something of a common-ish language in the region and the old East German connection linked up the country to the erstwhile Eastern bloc, so it's easy for the workers to move into Germany).

The central difference between the UK and Germany is where the workers are coming from, and their settlement patterns. Despite all the whingeing about Polish/Czech workers driving down UK wages, in fact there weren't *that* many Poles who came and, far more importantly, the *vast* majority of Poles who come to the UK leave w/o even staying a year, partly due to housing costs and other issues that make the UK nice for short-term stints but not so great otherwise. (Most of the others leave after a little more than a year.)

The *long-term* foreign-born British workforce therefore, is chiefly drawn from South Asia, the Caribbean and African countries within the Commonwealth. Whereas Germany's long-term foreign-born workforce is chiefly European origin itself. This is both from massive Italian/Greek immigration in earlier decades and due to the carry-over from the Eastern bloc system, which led to enormous long-term Polish/Czech/Slovak/Hungarian settlement in eastern Germany which continues today. (To my surprise, there really *aren't* that many Turks in Germany, not as much as I'm sure we used to think-- they really have gone home for the most part, esp. as Turkey's economy has strengthened.)

And yes, Germany's population is ageing, but then so is the UK's. If you separate out the foreign-born components, the native English and German fertility rates are both very below replacement, so both depend heavily on outsiders coming in-- just from very different sources.

Also, the vast majority of the young workers who take off from Germany do so for short stints and then return. This is nothing new-- tens of thousands of German youth do stints in the US or UK to intern in the banking systems and commercial centres here, then return. That's been going on for decades.

If anything, I was taken aback at how many Americans, Canadians and Australians have been immigrating to Germany in recent years, learning German and settling, raising families there. I don't claim to understand fully myself, but Germany seems to hold many attractions for professionals despite the taxes there-- eastern Germany is wired but cheap to live in, people have nice savings in Euros, outstanding schools plus the cities really are splendid and well-kept.

For that matter, Spain and France are soaking up not only Eastern Europeans but *Britons*-- hundreds of thousands of whom, now generally young and well-educated, leave each year and stay there. Along with those from everywhere else in the world. So as far as the "global attractiveness" sweepstakes goes, seems that Spain and France both vastly outdo the UK and Germany here.

As far as what makes a global city, seems that's mostly a matter of turning the city into an attractive place for talented people (business starters and artistic types) from elsewhere in the world. Paris, Rome, Berlin and other cities do this as much as London does, and there's no reason why smaller-ish cities like Sydney or Frankfurt in Germany couldn't do the same. It's a matter of putting one's own house in order first.

Jim Belshaw said...

That's a very interesting comment, Lenny. I need to give you access to some of my source material and especially on Germany so that you can judge it from your own experience. I will try to do so tonight.

Jim Belshaw said...

Lenny, again an apology for my slow response.As I said, I found your comment very interesting. Yur comment draws out the complexity of migration flows, illustrating the need to drop below the aggregate data.

Germany first. Earlier I put up a post about something that had puzzled me, the apparent loss of the German educated young. That post drew from a story on demography matters. Unfortunately, I did not put the link in.

I am sure that German young have always traveled for experience.

The key points made in the original demography matters post were about Germany's relatively low net migration and, within that, about the scale of long term or permanent migration of the educated, especially the professional, young.

The post suggested that this was creating an economic drag with long term consequences. If you click through on the link I gave, I subsequently checked the story with the local correspondent for the German national broadcaster who confirmed the trend and supplied an explanation.

This does not, of course, make my point correct. I am just explaining where it came from. Here I noted your comments on the attraction of young professionals to Germany.

I found your points on the UK very interesting.

In talking about the Poles I did distinguish between short term workers and migation.In this context, I noted your point about the short term nature of the stay.

To my mind, your comment "the central difference between the UK and Germany is where the workers are coming from, and their settlement patterns" raises a key issue. That is, the impact of varying migration sources on the demographic structures of cities and countries.

Who, for example, are the Brittish who have moved abroad to France and especially Spain?

To use an Australian example, one of the reasons for the progressive change in the ethnic composition of Sydney lies in the long term emmigration of Sydneysiders to other parts of the country. So Sydney attracts migrants, while losing locally born.

So in the UK case, what is the age of those going to Spain or France? Where do they come from? What impact is this having at home?

On cities,I disagree with you, at least in part. I am out of time now. But I will respond on this point later, perhaps even by another post. I find the city dynamics fascinating!