'Brexit' may alter, not cut, UK immigration, Open Europe says

[LONDON] Britain may not be able to afford to cut immigration if it leaves the European Union, though the government could adopt a more selective policy favoring skilled migrants, a report published Wednesday claimed.

Life outside the EU "will not be an apocalypse and it will not be a utopia," the Open Europe think tank said.

"While there would be political pressure to reduce immigration following Brexit, there are several reasons why we believe headline net immigration is unlikely to reduce much."

Demands from businesses for a flexible supply of labor, the need for an influx of younger workers to offset the challenge posed by an aging population and the effects of globalization on migration flows mean people will keep coming to the UK, the organization said.

The government could, however, seek to boost the share of immigrants from outside the EU and focus more on skilled workers.

Concern about immigration is one of the key arguments used by the groups campaigning for Britain to leave the EU following the June 23 referendum. They argue the bloc's freedom-of- movement rules have allowed unfettered access that's depressed wages and put pressure on public services. Net migration - the difference between people arriving in the UK and those leaving - climbed to 323,000 in the year through September 2015.

Prime Minister David Cameron's government is pushing the economic side of the argument, saying a Brexit would derail growth and cause extensive job losses.

The tone of the Open Europe report contrasts starkly with the International Monetary Fund, which cut its UK growth forecast Tuesday and warned of "severe" damage to the world economy if Britain were to leave the EU.

Open Europe said the government could change its current unbalanced policy - skewed towards migration from other EU members - to a system similar to that of Canada or Australia that's geared to attract skilled migrants. A temporary mechanism to bring in low-skilled labor would still be needed, the report argued.

BLOOMBERG