What National Insurance really tells us about London’s overseas workforce

The release of the latest data on National Insurance registrations by people from overseas offers a good insight into economic migration into the UK. The headlines on the release of the data focused on the rise in Romanians. That was certainly the case, but the detailed data and longer-term trends show the changing patterns of new arrivals and give clues as to what drives people to come or stops them from doing so.

The financial year 2014-15 saw a substantial jump in the number of people from outside the UK seeking to work in London. The number registering for a National Insurance number in the capital was up by 38% on the previous year to 334,419. That’s around 40% of total registrations for the UK.

Anyone looking to work in the UK or claim a benefit needs an NI number, including the self-employed or students working part time. Although people may have been in the UK some time before they apply for a NI registration the data is seen as a useful proxy for migration rates and has the benefit of being based on hard figures rather than the survey estimates used to calculate migration totals.

The biggest and the fastest growing group are Romanians. Registrations in London increased by 200% in year, rising from 22,000 in 2013-14 to 67,000 in 2014-15.

NI all overseas

Romania and Bulgaria joined the EU in 2007 but were not allowed free access to work in the UK given to other EU citizens until January 2014. The number of Bulgarian registrations in London went up to a little over 18,000, a rise of 178%.

The figures show that it is not just the new members of the EU that are increasingly coming to London but people from southern Europe. After Romanians the biggest single national group last year were the 35,000 Italians.

NI leading nations

The historical data shows how there has been a strong and sustained growth in people coming to work in London from southern Europe (Italy, Spain, Portugal and Greece) since the economic crisis of 2008.

The economic woes in southern Europe that has pushed many of its workers to the UK may also be a factor influencing the decision of Romanians and Bulgarians to come. Traditionally Romanians have headed primarily to Spain and Italy to find work outside their own country.

The change to restriction, allowing access to the UK labour market, is the trigger for the 2014 spike in what the EU refers to as the A2 countries (Romania and Bulgaria) but that spike may be sharper due to economic circumstances in their preferred southern European labour markets.

The cumulative totals for workers from Spain, Italy and Romania show the southern Europe effect. The spike in 2014 for Romanians may have been a more gradual rise since the economic downturn since 2008 if the restrictions had not been in place.

NI Sp It Rom cumulative

For the EU’s co called A8 nations, the Eastern European states of Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia, the trend is steady over recent years. Led by workers from Poland registrations soared after they joined the EU in 2004. The financial crisis in 2008 led to a drop in arrivals but that there has been a gradual increase since then as the UK economy recovered.

Workers coming from Europe are the dominant overseas groups in London. In 2009/10 they accounted for 40% of London registrations. By last year that had increased to 78%.

The data for Asian registrations helps explain this change. NI registrations by people from Asia had climbed steeply in 2009 but fell sharply from 2011 onwards as the Cameron government introduced new restrictions on migrants that applied only to those from outside the EU.

Figures for the first quarter of this financial year (April – June) show registrations from Romania and Bulgaria continue to be a dominant factor. If the trend for the A8 nations from Eastern Europe is repeated then this will continue to be the story for the next few years.

Source data

See also

The importance of the London factor in overseas worker numbers

New workers stick together and head north of river as they settle in the capital

Where in the world would you like to work?

Poles and Pakistanis help shape the multi-cultural make up of the city