The impact of EU immigration on wages and employment of natives in the UK: an analysis exploiting changes in migration patterns after the Brexit referendum

Abstract

After the 2016 UK referendum on EU membership, in which the topic of immigration played a prominent role, net EU migration to the UK dramatically fell. This study aims to exploit this change in migration patterns and empirically analyse the impact of EU immigration on the wages and hours of work of natives in the UK in the period after the referendum. Results indicate that EU immigration has a positive effect on average native wages (and thus an outflow of EU workers after 2016 could have led to a wage decrease), although this effect is unevenly distributed across native skill groups. While those at the upper part of the wage distribution are positively impacted by EU immigration, its effect on the outcomes of low-skill natives is negative, which, given the educational composition of EU immigrants, points to the persistence of considerable downgrading upon arrival.