Is 37% of new housing need from International In Migration – A Cautionary Tale about how to Misinterpret Statistics

Around the turn of the millennium the ONS gave evidence to a parliamentary select committee that around 20% of the component of change of new household formation was due to international in-migration. In 2002 Teresa May gave a speech that it was now 25% and putting pressure on schools and the NHS. According to the ONS (using a new methodology) in 2015 it was 37%. So is international in migration putting increasing pressure on housing need?

Several things firstly net migration to and from the EU is now nearly zero and yet net international migration migration rose. The reason for this is increasing number of international students (who of course pay for their education and healthcare) so is a statistical quirk as only a small proportion of these will get jobs, marry etc and form longterm residents. A more sophisticated measure is needed stripping out students from long term population and basing household formation from long term residents.

Secondly it is a rising proportion simply because this is a constant rising figure against a background in a collapsing household formation of long term residents. Why, because you need houses to form into. The ‘missing million’ of predicted household formation from a decade ago and actual households today is almost exactly correlated by local authority with where houses have not been built according to estimates.

Finally what would happen if you squashed down Badenoch style on current in migration, Asylum seekers aside (about 1/5th of net international in migration) it would mean banning international students and high skilled points style visa holders. So less tax on those potential taxpayers, higher labour costs for health and social care and an aging population with fewer taxpayers, hence higher taxes and government borrowing to pay for health and social care. Systems thinking Bade, Systems thinking, think like an engineer.

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