A Scotland for the future: opportunities and challenges of Scotland's changing population

Migration: Attracting And Welcoming People To Scotland

What does the evidence tell us?

Historically, Scotland experienced negative net migration for decades, with more people leaving Scotland than arriving. That legacy means that Scotland today is more reliant on migration than other parts of the UK. 

Over the past twenty years, Scotland's migration flows have changed, with outward migration to the rest of the UK (rUK) declining, and inward migration from overseas rising significantly in the 2000s. Net migration from both rUK and overseas have now been consistently positive for over a decade. 

In the year to mid-2019, net total migration to Scotland was +30,200. Net rUK migration was +10,000, with inward and outward flows of 47,500 and 37,400, respectively. Net overseas migration was +20,200, with inward and outward flows of 39,900 and 19,700.^[49]

Migration within the UK

Over the past two decades, around two-fifths of Scotland's total migration flows have consisted of migration between Scotland and the rest of the UK. Over time, patterns of internal migration within the UK have changed significantly. For much of the 20th century the flow was predominantly people leaving Scotland for the rest of the UK. Between 1951-52 and 2000-01, 399,000 more people left Scotland for elsewhere in the UK than vice versa. However, since mid-2001 that dynamic has reversed, and net positive flows from the rest of the UK have increased Scotland's population by 147,000.^[50]

People who move between Scotland and the rest of the UK tend to be relatively young, with relatively high education levels. Inward flows from elsewhere in the UK have two peaks: those aged 18-20, many of which are likely to be students, and those in their late 20s and early 30s. Outward flows follow a similar pattern – however, the peak at ages 18-20 is lower, reflecting that fewer young people in Scotland move to the rest of the UK to study. 

Outward flows of those in their mid to late 20s have declined in recent decades, suggesting that more students are staying in Scotland after graduating. 

Overseas migration

Overseas migration to Scotland rose markedly in the 2000s following EU enlargement, from +28,500 in 2003-04 to +47,400 in 2009-10. Since then the figure has fluctuated, but net overseas migration to Scotland has remained consistently positive in every year since 2003-04.^[51]

The profile of overseas migration to Scotland is similar to that of migration within the UK. Most people who come to Scotland from abroad are working age – in the year to mid-2019, 80.2% (32,000) of overseas migrants to Scotland were under 35, compared to 41.1% of Scotland's general population.^[52] Around two thirds of overseas migrants to Scotland have a degree, compared to around one third of Scotland's general population.^[53]

Migration and the economy

Migration can help alleviate some of the challenges associated with Scotland's demographic change. Without migration Scotland's population would be in decline with deaths exceeding births.^[54] Migrants who come to Scotland tend to be well educated and highly skilled, help raise productivity and contribute to government revenue.^[55]

There is also evidence to suggest that migration can specifically help alleviate issues related to skill shortages in the labour market. For example, a summary of the available evidence by the Bank of England suggests that EU workers may have filled skill gaps or specialised in different tasks. Specifically at the firm level, the Bank points to research by Rolfe et al (2013)^[56] that found that employers in the pharmaceuticals, IT, banking and universities sectors recruited from outside the UK in order to fill skills gaps that exist in the resident population and to complement the skills of non-migrants.

Scotland's seasonal industries are particularly reliant on migration. Those industries are particularly significant in rural and remote areas where populations tend to be older and population growth lower. While 8.3% of Scotland's overall employment was made up of non-UK workers in 2019, this rose to 16.0% in Food & Drink and 15.0% in Tourism.^[57]

Future migration to Scotland

Scotland's population is projected to grow by 2.5% between 2018 and 2043.^[58] All of this growth is projected to come from migration, as there are projected to be more deaths than births in Scotland every year moving forward. However, this NRS projection is not a forecast, it assumes that migration flows will stay broadly consistent with average levels over recent decades.

Future migration flows are difficult to predict. Since 2010, migration to Scotland from overseas in particular has fluctuated significantly year-on-year. Moreover, looking ahead, EU exit and COVID-19 both represent significant sources of uncertainty about future overseas migration to Scotland. 

EU exit

The UK's exit from the EU will have major implications for overseas migration. On 1 January 2021, the UK's participation in EU free movement ended, and a new UK immigration system came into effect.

In 2019, the Expert Advisory Group on Migration and Population was commissioned by the Scottish Government to consider the impact on Scotland's economy, communities and public services of the UK Government's proposals for the new immigration system.^[59] The Group estimated the impact of the plans would be a 50-80% reduction in net EU migration to Scotland after 2020, and an overall reduction in overseas net migration to Scotland of 30-50%. These changes would disproportionately affect our rural areas which would be likely to see an even more significant reduction in migration. They would also have a pronounced gender effect with proportionally fewer women able to meet the salary threshold.

Restricted routes for EU immigration would also be particularly disruptive for rural and remote areas of Scotland, where the old age structure means that in-migration is the only means of countering depopulation.

These proposals will significantly change the patterns of migration Scotland has seen over the last 10-15 years. A proliferation of smaller groups of migrants from a wider range of countries,. A predominance of shorter stays, changes to gender, age and family profiles will require planning and investment for successful social integration.

An update to that analysis in July 2020, in light of revised Home Office proposals, retained the same projections.

It has also been confirmed that free tuition for EU undergraduates will end for those starting studies at Scottish higher education institutions from 2021-22 onwards, as existing arrangements under EU law will no longer apply.^[60] Unfortunately, this could lead to a significant decline in numbers of EU citizens coming to Scotland to study each year, as undergraduates will now need to pay international student fees, as well as meeting Home Office student visa criteria. 

The wider economic implications of our exit from the EU, with our previous modelling suggesting that our GDP could be at least 4.5% lower in 2040 than if Scotland had remained part of the EU, may also have a knock-on impact on overseas migration, especially if EU exit contributes to an economic downturn as jobs and opportunities become less available.

COVID-19

Like EU exit, COVID-19 has direct impacts on opportunities for migration, as well as wider economic and demographic implications. 

From the outset of the pandemic, there has been a significant impact on the movement of people across borders. A short-term global impact of COVID-19 has been a sharp fall in migration, with prospective migrants forced to delay plans, and flows of seasonal migrant workers, for example, dropping dramatically.^[61]

As well as migration to work, migration to study has also been affected in the short-term. Universities Scotland has outlined a 50% drop in the Scottish sector's intake of international students in 2020-21 as a "mid-range" estimate.^[62] The full impact on the sector's significant levels of international staff is also not yet clear. However, there is a risk that the combined impact of COVID-19, EU exit and the new UK immigration system could create a perfect storm for our institutions in maintaining Scotland's position as a leader in international student and staff recruitment, with likely knock-on effects on the competitiveness and sustainability of the sector.

There is further evidence that COVID-19 has resulted in reductions in non-UK national employment in the UK, with the employment level of non-UK nationals falling by 12.0% in the year to Jul-Sep 2020 compared with 0.5% for UK nationals. Such a large fall in employment levels would normally be expected to result in a lower employment rate, however, at the same time, the employment rate of non-UK nationals fell only slightly (from 76.2% to 76.1%), suggesting a significant fall in non-UK national residency in the UK.^[63]

It is still too early to predict precisely the long-term impact of the pandemic on overseas migration to Scotland, or broader global migration patterns. This is likely to depend on the relative economic impact of the pandemic in different places, and how this in turn affects differentials in wages and wider economic conditions.

Beyond economic effects, the long-term demographic impact of the crisis on mortality and fertility may only increase Scotland's need for overseas migration, in a global context where competition for migrants could be high. For example, early evidence from several European countries, including the UK, suggests that the pandemic has already had a significant impact on plans to have children.^[64]

Ambition

Scotland is a welcoming and open country, with a long history of welcoming people of all nationalities. We want people from across the UK, and across the world, to make Scotland their home. We are committed to upholding and promoting equality and human rights for all people. 

Migration enriches our society and culture, and migrants make a net contribution to our economy, our public services and our public finances. Migration is also essential to addressing our demographic challenges – our declining birth rate, ageing population, and rural depopulation. It is vital that we grow our working age population to ensure that Scotland has sustainable, vibrant and resilient communities now and into the future. 

Current UK Government policy

Immigration policy is reserved to the UK Government. This places major constraints around the Scottish Government's scope for action on migration. The Scottish Government, working with a broad range of partner organisations, including local government, employers and trade unions has argued for a tailored approach to migration which meets Scotland's needs. Unfortunately the UK Government has not so far engaged with the evidence on Scotland's needs.

In January 2021, the UK Government implemented a new immigration system, replacing the previous five-tier model.

EU citizens who were living in the UK by 31 December 2020 will need to apply to the EU Settlement Scheme by 30 June 2021 if they wish to stay in the UK after this date. In the future, EU citizens who do not qualify under this scheme will need to apply and qualify for entry to the UK on the same basis as non-EU nationals.^[65]

An overview of changes under the new system is provided at Annex A.

Implications for Scotland

The Home Office has committed to ensuring that the new immigration system meets the needs of all parts of the UK. To date, however, the new system offers no recognition of Scotland's distinct demographic or economic needs and the UK Government has not sought to engage or adapt their approach. 

The introduction of skills and salary thresholds and sponsorship requirements for EU workers will generate significant challenges for communities across Scotland. The Expert Advisory Group on Migration and Population has estimated that the impact of the proposals on Scotland will be a 50 to 80% reduction in net migration from the EU, and an overall reduction in overseas net migration of 30 to 50%. 

Further analysis by the Group has identified that very few jobs would meet the proposed salary threshold in several key sectors in Scotland, including agriculture and social care,^[66] raising the prospect of significant labour shortages. The plans are likely to have a particularly severe impact on migration to rural areas of Scotland that already face significant demographic and economic challenges. 

However, the Home Office currently has no plans to include a route for jobs below the skills threshold; has rejected the possibility of any regional variation in the salary threshold;^[67] and has not clarified whether or how the Scottish shortage occupation list will continue to operate. In addition, while former Home Secretary Sajid Javid had accepted a previous UK Migration Advisory Committee recommendation to work with the devolved nations to pilot a visa scheme aimed at supporting overseas migration to rural areas of the UK, the Home Office has now reversed this decision. 

Current actions and commitments

Without direct powers over immigration policy, the Scottish Government's current work in this area focuses on:

• welcoming and supporting those who choose to make Scotland their home
• supporting businesses to attract and retain international talent in Scotland
• supporting universities to attract international students and staff to Scotland 

• The Scottish Government launched the Moving to Scotland resource at the end of January 2021. offering practical, easily accessible information online for people who have recently moved or plan to move to Scotland.
• The Stay in Scotland campaign, which covers a variety of practical resources for EU citizens, including toolkits, factsheets, and leaflets, providing information and signposting support.
• Citizens Advice Scotland delivers an EU Citizens Support Service which assists EU citizens to secure the right to stay in Scotland, with a particular focus on supporting those who are vulnerable or with more complex needs.
• In partnership with local authorities and the Scottish Refugee Council, we have led the New Scots refugee integration strategy, supporting all of our local authorities to support and integrate resettled refugees.
• We fund TalentScotland to deliver its Immigration and Visa Support Service, providing information and support to help Scottish businesses navigate the UK immigration system to attract and retain workers from overseas, and support inward investors considering Scotland as a location.
• We are developing a new Talent Attraction and Retention Service for Scotland, bringing together hubs across Scotland offering information and advice to support migrants before and after arriving in Scotland.
• We will support the delivery of Skills Recognition Scotland, an overseas skills recognition framework, to help employers recruit qualified migrant workers, including in priority sectors such as health and social care.
• We are working closely with universities and colleagues to ensure our message that Scotland remains a safe, secure and welcoming destination is reaching international audiences.
• We will continue to work with EU institutions to explore options for maintaining as close a relationship with Erasmus Plus as possible, and to lobby the UK Government on the importance of having a post-study visa option that is competitive with offers from other countries.

What more needs to be done?

The development of a tailored approach to migration which meets Scotland's distinct needs. 

The Scottish Government will continue to develop the evidence base and to work with partners to develop practical, deliverable, evidence-based proposals which meet Scotland's needs. We need the UK Government to engage in this discussion. 

We will continue to develop policy proposals drawing on international evidence from Canada, Australia and elsewhere that differentiated migration policy can provide effective solutions to distinct demographic needs, as well as working with partners to present clear evidence of the needs of Scottish employers, public services and communities to the UK Migration Advisory Committee (MAC) and UK Government. 

Learning From International Examples

The Expert Advisory Group has already looked at the experience of immigration policy and demographic change in Australia, Canada and continental Europe. They find that national and local governments have sought to address geographic shortages through encouraging population retention and increased migration. Immigration can provide an effective and efficient mitigation as part of a wider package of measures.

Canada and Australia both have regionally differentiated points-based systems. They have traditionally been human capital schemes, but also build in employer-based considerations. They offer extensive rights and pathways to settlement. As well as regionalised immigration programmes in each country, the Group also analysed Canada's recent Atlantic Immigration Pilot Program to promote retention in remote areas, which is of particular relevance to Scotland. 

Most European countries have adopted employer-based programmes, and those most relevant to addressing shortages created by demographic change are programmes that encourage longer-term settlement, spanning a range of occupations and skills levels. The Spanish Catalogue of Hard-to-Fill Occupations, and the Swedish 2008 Immigration Law are examples the Group considered.

In January 2020 we published Migration: Helping Scotland Prosper, setting out how a tailored approach to migration for Scotland could work in practice, including practical proposals for a Scottish Visa as an additional option within the UK immigration system. We will continue to build the case for a Scottish Visa which has is a practical evidence-based proposal to meet Scotland's distinct needs. 

In May 2019, the UK Government's immigration advisors the Migration Advisory Committee, following evidence from the Scottish Government, recognised the distinct challenges facing rural communities and recommended the development of a pilot to facilitate migration to these areas:

This indicates that the current migration system is not very effective in dealing with the particular problems remote communities experience. Trying to address these problems through regional SOLs [Shortage Occupation Lists] is unlikely to be successful. If these problems are to be addressed something more bespoke for these areas is needed.

The international evidence suggests that such regional schemes can struggle to retain migrants in the areas they were recruited in once they have the freedom to move, so the key question is whether migrants into these remote areas settle there permanently or leave for other parts of the UK. The only way to address this question in the UK context would be to pilot a scheme that facilitated migration to these areas, then monitor what happens over several years and evaluate the outcomes. The MAC is willing to provide advice on the design of a pilot scheme for remote communities.^[68] 

The then Home Secretary, Sajid Javid, made a Written Ministerial Statement on 23 July 2019 accepting the recommendation to develop a pilot scheme accepted this recommendation in July 2019. The Scottish Government has offered to work with the UK Government to design and develop solutions in the UK migration system, including rural pilots. On that basis the Scottish Government commissioned the Expert Advisory Group on Migration and Population to consider what a pilot approach to migration in rural areas would need to achieve in order to benefit Scotland's rural and island communities. 

The Expert Advisory Group's report has now been published and it identified three possible models for a rural pilot:

• Expanding Skilled Worker route. This would involve relaxing conditions for the Skilled Worker route in the new UK immigration system, specifically for employers in designated areas, potentially through a bespoke Shortage Occupation List for remote and rural areas;

• Scottish Visa. This would build on the Scottish Government's proposal for a Scottish Visa as set out in our January 2020 migration paper, but aimed specifically at designated areas. Instead of entrants being identified by employers, it would involve a points-based system, which could prioritise targeted characteristics; and

• Remote and rural partnership scheme. Modelled on the Canadian Atlantic Pilot scheme, this would be an employment-based scheme, but as part of a wider partnership between local authorities, employers, public services and the voluntary sector, who would play a more active role in identifying which types of areas and employers would benefit most from the scheme, and would be engaged in delivering an 'integration plan'.^[69]

These proposals are evidence-based and reflect international models. The current UK Government has not progressed the Migration Advisory Committee's recommendation for rural pilots. The Scottish Government remains committed to developing solutions that benefit Scotland's rural and island communities and we will look to work with local authorities and the UK Government to develop a pilot proposal. 

Our ask is that the UK Government delivers on the commitment made by the then Home Secretary in 2019, accepts the evidence of its own migration experts and works with the Scottish and local government to deliver rural migration pilots.

In February 2018, the Scottish Government set out five areas where the UK Government should revise their migration policy: 

• Reintroduce the post-study work visa recommended by the Smith Commission;
• End the net migration target;
• End the immigration skills charge;
• Give the Scottish Government a greater say in the Scotland Shortage Occupation List; and
• Extend and protect rights in family migration.

The UK Government has subsequently made changes in two of these areas - ending the net migration target and reintroducing a post study work visa. We will continue to press for action on the other vital reforms to the UK immigration system as well as wider reviews of the salary thresholds for skilled workers and an expansion of youth mobility visas. 

The Migration Advisory Committee in their 2020 Annual Report called on the UK Government to review the family migration route noting that 'previous analysis may have given too much weight to the fiscal contributions of such migrants and insufficient attend to the benefits that accrue, to both the family and society, from the route.' The Scottish Government has commissioned the Expert Advisory Group on Migration and Population review the family migration route. There is evidence that the ability to bring family members to Scotland is an important factor which encourages migrants to stay long-term. The policy approach to family migration needs to support our shared population ambitions.

Building on Scotland's capacity to attract and retain people from rUK and overseas

Since 2009, over 1,400 students from Scotland's priority countries have benefited from the Scottish Government's Saltire Scholarships. We will continue to consider options to attract international students to Scotland, exploring the expansion of the Saltire Scholarships programme and the development of an international student retention programme. 

We recognise the importance of global alumni in helping to attract and retain talent and will consider initiatives to mobilise these networks to promote Scotland as a place to live, work and study.

The issue of attracting people from overseas remains difficult due to immigration powers being reserved. 

However, we do not need more powers to attract people from elsewhere in the UK or indeed from across the Common Travel Area and we will explore further interventions. Our Inward Investment Plan which demonstrates nine opportunity areas under three overarching themes of Net Zero, Digital and High Value Manufacturing has identified a number of priorities. We must better use our communications methods to sell the benefits of Scotland to people living in the UK and across the Common Travel Area. 

Communication to International Audiences – 'Scotland Is Now'

The Brand Scotland Strategic Partnership is a collaborative initiative that promotes Scotland's reputation to international audiences. The aim of the partnership is to collectively increase the impact of marketing communications activity to present Scotland as the best place to live/work, study, visit and do business via the joined-up narrative strategy #ScotlandIsNow. The approach highlights Scotland's strengths in the context of current performance and, in addition to campaigns, supporting collateral is produced for use internationally by partners and wider stakeholders. Therefore, where communication can support the delivery of the population aims and objectives, this established function and approach can be leveraged. Where relevant the population programme will draw on Brand Scotland for support to ensure a consistent approach to international messaging and campaigns. Further investment in activity is required to support our broad aims to have enough people of the right ages in the right places in Scotland. 

Communication to Domestic Audiences – 'We Are Scotland'

This established domestic communications strategy can be drawn upon for supporting communication in Scotland to highlight the 'welcome' message. 'We Are Scotland' was originally conceived to promote inclusivity and improve attitudes towards in-ward migration in Scotland. Since its launch it has been extended further to promote positive behaviours such as kindness and volunteering and has now become the overarching COVID-19 communications narrative strategy. The primary aim of this values-based approach, in relation to the pandemic, is to motivate collective action around adherence to restrictions and hygiene behaviours through the recovery phase and beyond. 

In attracting people to live in Scotland, and particularly in our more rural areas, we must ensure we have jobs for both partners, otherwise while we may successfully attract valued workers, they may not remain if there are not opportunities for families and partners. We commit to undertake work to explore how we and partners can offer a support package to those who wish to move and work in Scotland, including support around housing, spousal recruitment and family support where needed as part of our talent attraction and retention work as well as explore the potential to extend these options to overseas in the future. 

We must not forget that it is not only about attracting people here. We must look to retain our own population as well. The Expert Advisory Group on Migration and Population undertook an analysis of internal migration between Scotland and the rest of the UK their analysis of trend in net migration concludes that:

Scotland is losing people in ages 22 to 26 to rUK, but in lower numbers than was the case at the beginning of this century.

Some young people leave Scotland to study elsewhere while some students leave Scotland after their studies have been completed. While it is important that people have opportunities to work, travel and study elsewhere it is also important that we seek to ensure that we increase the numbers of people who want to stay in Scotland and to make it easier for those who do leave to return. 

While we do not want to stand in the way of individual's choices, we must do work to understand why our students leave and, where possible, what more we can do to get them to stay. We will work with Universities to consider the issues behind student retention in Scotland. We will consider how best to target those people who have chosen to leave Scotland and encourage them to consider returning. We have commissioned advice from the Expert Advisory Group on Migration and Population on the family migration rules which too often limit the ability of people from Scotland who moved overseas and now want to return to the UK.

People across the world, from Australia and New Zealand, through Europe to the USA and Canada, have ancestral roots, affinity or connections to Scotland. An estimated 50 million people world-wide claim Scottish ancestry. The Scottish Government values those long-term and growing links and networks and sees them as welcome advocates for Scotland and its values. 

We will continue to engage with those networks, encompassing, but not limited to, those groups with a historic or familial identity, alumni, business and cultural networks, incorporating Scotland Is Now messaging into our activity and communications. Scotland's overseas presence with its network of international offices is key in engaging with the traditional and widened diaspora and a wide range of stakeholders in order to promote Scotland as an attractive, modern and welcoming place to live and work, do business and study. 

Migration: summary of actions

#	Action	Action for
13	We will continue to develop an evidence-based case for a tailored Scottish approach to migration	Scottish Government
14	We will work with local government partners to develop proposals for a remote and rural migration service pilot to present to the UK Government	Scottish Government, Local Authorities and UK Government
15	We commit to publishing a report from our Expert Advisory Group on a different approach to family migration	Scottish Government
16	We will continue to press for vital reforms to the UK immigration system	Scottish Government and UK Government
17	We will continue to consider options to attract international students to Scotland, such as exploring a new scholarship offering and develop an international student retention programme.	Scottish Government with university sector
18	We will explore, through our talent attraction and retention service, how we can attract talent from across the rest of the UK, particularly in key sectors identified in our Inward Investment Plan	Scottish Government, Scottish Enterprise and Skills Development Scotland
19	We commit to undertake work to explore how we and partners can offer a support package to those who wish to move and work in Scotland, including support around housing, spousal recruitment and family support where needed as part of our talent attraction and retention work	Scottish Government, Scottish Enterprise and Skills Development Scotland
20	We will undertake work to look at students who go on to leave Scotland for work and other reasons and explore opportunities to encourage them to stay or return	Scottish Government with university sector