I have noted before the relative silence on trade in services in the Brexit conversation. Attention has been focused on the at-the-border issues associated with trade, rather than the more complex behind-the-border issues of domestic rules, regulations and qualifications, which are germane to trade in services. As I have said before, this silence is particularly hard to understand, given services’ contribution to the UK. They account for over 40% of total exports, 80% of the UK’s GDP and four in five jobs across the country. The largest single destination for UK services is the EU, worth £90 billion annually.
If services have been treated like the second son, mobility has been the Cinderella of the story, pushed from the start to the wrong side of what some of us see as a wrong-headed red line. There is, of course, an inextricable link between mobility and services. Services provided in this country, such as tourism or higher education, depend on inward mobility. Service packages linked to goods, such as maintenance contracts, depend on outward mobility. Services delivered in the consumer’s country are often provided on a fly-in, fly-out basis, and the scale of this trade is significant. The CBI reports that employees of just one firm undertook 17,000 trips from the UK to the EU and 10,000 in the opposite direction in a single year.
The complex interdependencies between services, goods and people are exemplified in the outputs of the creative and cultural sectors. I make no apologies for mentioning this once again today. The creative industries are responsible for 10% of UK service exports, are creating jobs at four times the rate of the wider economy and contribute a staggering £101 billion in GVA each year. Their success has been achieved off the back of the freedom to move people and kit across borders without visas, carnets or tariffs, and to bring in talent from the EU as and when needed, often at ridiculously short notice. In the most economically productive parts of the sector, domestic skills gaps mean that up to 30% of staff are recruited from the EU. Continued mobility post-Brexit is the creative industries’ number one priority.
I want to mention the 1.5 million low- and medium-skilled jobs in the UK currently filled by EU workers. A vast number of business sectors rely on this supply stream for vital roles in teaching, health and social care. We already have workforce shortages and requirements are only going to increase. It is estimated that we will need an extra 650,000 care workers by 2035 to look after our ageing population. With virtual full employment in the UK at the moment, it is not clear where these workers will come from.
I know there are differing opinions in this Chamber on the public’s views on mobility. Indeed, there are differing public views, as noted already by the noble Lord, Lord Fox. But can we focus for a moment on the facts, as contained in the Migration Advisory Committee’s report? There is no evidence that immigration impacts on employment outcomes or wages. Also, as we have heard, immigrants contribute more to health and social care services than they consume.
Finally, let us not forget that mobility works in two ways. This amendment would not only protect the UK services sector, the jobs it provides and the tax revenues it generates, it would preserve the rights to travel, work, learn and trade across borders—rights which all the research shows are foremost among the concerns of young people today. I urge noble Lords to support this amendment.