Housing shortage has sparked dangerous talk of ‘managed’ migration

It is easy to forget that by western European standards, Ireland was poor as late as 1990. The pace of our economic development was almost unprecedented, and is due, to a great extent, to the vast sums of money invested by multinational (read American) firms since then. Those firms are only here for two things: tax and talent.

We all know the tax bit. In recent years, corporation tax receipts have swelled as a result of changes in US tax policy. More money looks like it is coming our way if the OECD minimum effective rate of 15 per cent comes to pass. However, we are likely experiencing the high point of that particular economic trick, with excess tax receipts papering over the cracks of Covid and the cost-of-living crisis. It has immunised our leaders from the politics of hard decisions.

The OECD process suggests that the mood music has changed on taxation. We are not guaranteed another 10 years of bumper tax receipts. Similarly, tech has taken a wobble, which indicates that, whatever about the tax rate, there may come a time when there is not quite so much profit to tax.

Clearly, this part of the Irish success story is under threat and the source of the threat is external. We can only do so much to change US tax policy (Paschal Donohoe’s best efforts with US secretary of the treasury Janet Yellen aside), and we can do nothing to affect the global tech industry.

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But talent is under threat now too, with no sign of abatement.

When we talk about talent, we are talking about the steady supply of high-quality graduates to service the needs of the multinationals that glisten along the Liffey. Entry-level software engineers at Amazon. Trainee lawyers at Matheson. Data analysts at Stripe.

The sources of the talent are domestic or foreign. It’s either young graduates from Irish third-level institutions or it is foreign workers looking to work in one of Europe’s strongest tech ecosystems.

Irish economic success depends, to a significant degree, on making Ireland (and really this means Dublin) the kind of place that young Irish workers want to stay in and that young foreign workers want to come to. And we know that the housing crisis is increasingly making that a tough sell.

Why put up with exorbitant rents in Dublin, when you can pay similar rents London with all that global city has to offer? Why put up with grey Irish skies, when you can work as a software engineer in Lisbon?

Unless there are compelling reasons for talent to stay in and move to Ireland, then Irish economic success is under serious threat.

Even more worryingly, migration is becoming a point of political debate. Ugly protests against refugees have been a feature of European politics for a decade but not in Ireland. This shift in debate has been brought on by the refugee crisis precipitated by the war in Ukraine but, if we are not careful, it threatens to become a wider backlash against migration into the country.

In the blink of an eye, non-Irish nationals have gone from 5.8 per cent (2002) of those usually resident in the State to 12.9 per cent (2021). Since Ireland has become a net importer of people, migrants have enriched Irish society and culture. And more crudely, they have been an integral part of what has made us rich.

The refugee protests are nasty and may seem a world away from a more mundane political resistance to general migration. But the current protests could shift the debate such that a more general anti-migrant position becomes “moderate”. Aontú is already making soundings in that direction.

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The rise of Bill Clinton gave our political lexicon a new concept: triangulation. It was a strategy that involved embracing some opposing political views to immunise a political actor from attack. There is a risk that this could become the response of one (or more) of our major political parties to hardening views on refugees. We may see the language of “managed” migration emerge. Given the vitriol directed at Sinn Féin at refugee protests, they might be the first to budge on the issue. Their support from young people, however, should act as a buffer against this.

But there are already threads to pull on in facilitating the rhetoric of “controlled” migration. Some housing commentators decry new developments as being geared towards “transient workers”, ie what they call workers who are only in an area for a short while and do not have an incentive to contribute to the local community. Whether intended or not, “transient workers” disproportionately means foreign workers.

As a “transient worker” in London, it’s irksome to read this complaint levelled by the middle-class occupants of some of Dublin’s nicest suburbs. After all, I work with some of their lawyer/accountant/banker children in London, and I can assure them that their children are not joining neighbourhood watch or picking up litter in the local area. And, of course, their parents would not expect them to either.

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Without very careful management, an anti-migrant position could open in Irish politics. We cannot simply keep repeating platitudes about how welcoming Irish people are.

At the heart of the immigration and emigration questions is the housing crisis. That will be with us for some time, so we need to think about how we manage the difficult transitory period until it abates.

If Ireland’s tax advantage disappears, it will not be our fault. But if we lose our edge on talent, that is on us.

Let’s not kill the golden goose.

Eoin MacLachlan is a barrister at Maitland Chambers in London