Immigration a response to labour market's needs

London Briefing:  Like many other countries, the UK is agonising over immigration. Always a hot topic, the debate has taken on several new twists of late.

The temptation for smug commentary in the wake of the French explosion of car burnings has, surprisingly perhaps, largely been avoided.

We are too conscious of our own relatively recent history of inner-city rioting and painfully aware that more than one learned commentator is declaring that our post-war experiment with multiculturalism has failed.

Far from peacefully co-existing with each other, so the argument goes, our various ethnic communities simply sit in ghettoes of varying quality.

The economic dimension to the debate is readily apparent. It has long been taken as given that immigration is good for business and helps the economy grow.

Siren voices have begun to challenge this orthodoxy. From high-profile commentators at the Financial Times to the anti-immigration lobby group Migration Watch, we are seeing analysis that says there are no economic benefits arising from the people that lap up at our shores. David Aaronovitch of the London Times is one of the UK's more thoughtful - and intelligent - commentators. In one or two ways, he is the nearest we have to the New York Times' Tom Friedman - winner of many a Pulitzer Prize - and has just been awarded the inaugural Business Book of the Year prize by the FT and Goldman Sachs.

Aaronovitch's father, Sam, was a card-carrying member of the British Communist Party. As one of my first economics teachers, I was able to forgive him this one aberration - his intellect and integrity were second to none and it is nice to see Aaronovitch junior displaying similar qualities without the affection for Marx. He echoes some of Friedman's analysis and has worked out what globalisation actually means for the immigration debate (amongst other things).

What is weird about the current hostility towards immigration is less the drearily familiar racist slant to the debate but more the tendency of the left to decide that the time has come to shut the door. The belief of some ageing Marxists (Sam would never have fallen into this trap - he was too good an economist) is that immigration undercuts the poor by stealing their jobs and reducing their wages.

Mostly baloney of course, but the idea seems to be striking a chord with some of the brothers. Their fathers would be appalled: left-wingers of Sam's generation understood that immigration is inevitable and good. Closed societies fail. But the consequences of globalisation mean that this debate, interesting though it might be, is almost irrelevant. One key aspect of globalisation is that people move to where the jobs are, whether or not the rules say they can cross borders.

The newspapers have noticed a large number of eastern European immigrants since the EU moved to enlarge itself to a grouping of 25 countries. But the truth is that Poles have been cleaning our flats and houses for many years. If the jobs are here, they will come, whether or not ageing trade unionists want them to.

And that's the point: people leave their home countries for many reasons but the primary driver is always economic advancement, a job. Anti-immigration types have always warned about "benefit tourism", but the incidence of people turning up on our shores merely to exist on welfare is relatively low.

People come here to work, in skilled and unskilled areas. One very politically incorrect thought: countries like the UK and Ireland need to ask themselves why so many people want to come to work in their respective economies. If there are that many jobs that are so attractive to the hundreds of thousands of people flocking to these islands, why do we still have so much unemployment? Or, indeed, any unemployment?

Any economist will tell you that immigration is mostly about supply and demand. Our economy needs these people and they are happy to come, and in this globalised world, that is all you need to know.

Until and unless the underlying supply/demand balance changes, immigration will continue at its recent rates.

Chris Johns is an investment strategist with Collins Stewart. All opinions are personal.