Did you notice the Cabinet rift starting to open on immigration? You might have missed it. Minister for Finance Paschal Donohoe was reported as backing up comments by Tánaiste Simon Harris who said rules needed to be tightened. And he did, to the extent that he said proper controls were needed on the asylum process.
But while Harris went on subsequently to say that he believed overall immigration was too high – including the numbers coming here to work as well as those seeking asylum, Donohoe’s comments were different. He underlined that having an open economy and society had been “tremendously important” for Ireland.
He added: “If we are going to, and I believe we should, maintain support for that openness in the future and make the case for the value of openness, we need rules to do that.”
The Government is clearly tightening the rules on asylum seekers, which is one aspect of immigration. A new EU pact on the topic, to which Ireland is broadly signing up, will continue this trend.
But Harris has also said he believes that too many people are coming here on the other main route to entering Ireland – work permits. This economic migration of workers and their families is likely to account for the bulk of immigration in the years to come.
A Department of Finance report, Future Forty, published this week to look at longer-term trends, says that we will continue to need these immigrants, including from countries outside the EU and UK whose citizens have an automatic right to come here. This is because of our ageing population, which means that after about 2035, so-called natural labour-force growth, which depends on the local population, will turn negative. Even in the shorter term, the report says, inward migration is expected to account for around three-quarters of labour force growth.
That said, the so-called central forecast does expect net migration – the excess of immigration over emigration – to decline substantially, from 59,700 in the year to April 2025 to 41,400 by 2030. On a so-called “high scenario”, the net figure would remain roughly where it is up to 2030, while on a “low” scenario it would fall below 25,000 by 2030.
Migrants – including many from outside the EU and UK – are needed to supply critical skills in areas such as IT, medicine and nursing and construction and also in lower-paid areas such as accommodation. And as Ireland ages, younger immigrants can support the labour force and tax revenues and overall economic productivity.
The downside is that inward migration has added to pressure on housing – Harris said every 10,000 immigrants means demand for about 3,000 more houses as well as social infrastructure such as schools and hospitals. Were the “high” migration scenario envisaged by the department to transpire, these pressures would grow – the low scenario would see them ease. But the report’s assessment that housing demand will exceed supply for at least another 15 years shows that this central conundrum is not going away any time soon.
So if the Government really does want to move the dial and reduce economic migration, what can it do?
1. Try to slow the economy: Lower economic growth would slow immigration – as we have seen in the past, with the collapse after the financial crisis – though also increase emigration including by Irish people. But achieving this via budget policy, or asking IDA Ireland to attract less investment, is far from straightforward. The more significant impact on growth in the short term is more likely to come from international trends and their impact. But with Ireland at full capacity there are deeper policy questions here.
2. Cut back on critical skills employment permits: These are designed to attract skilled employees in areas where there is a shortage in Ireland. The list includes roughly 80 jobs in areas such as IT, nursing and medicine, science, planning, specialist areas of business management and so on. Just more than half of the 38,000 or so employment permits issued in 2024 (including renewals) were in this critical skills area.
There are various ways to lower this number. Just do it and accept the economic consequences. Or try to train more Irish people to fill the gaps which, in an era of low unemployment, is difficult. Measures to discourage Irish people with key skills from emigrating – or to encourage them to return home from abroad – could also be explored. The housing crisis is an issue here in keeping young people in Ireland.
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The lists of jobs to which these visas apply has been expanded in recent years and consideration is now being given in an annual review of whether to add – or subtract – from the current list. A move to reduce skilled immigration would be a policy U-turn, as the ability to recruit internationally is a key selling point to inward investors and seen as central to our economic model.
Peter Burke, the Minister for Enterprise who is in charge of this, told the Dáil last September that Ireland “is embracing the opportunities inherent in an outward-looking economic migration policy to support enterprise and demand for skills in critically important sectors”. Access to a mobile and highly skilled workforce from outside the European Economic Area “can serve only to generate economic growth and prosperity”, he said. Will there be a change in tone when this year’s review of permits is published?
3. Cut back on general work permits: These apply to employees not on the critical skills list; there is a list of occupations to which the permits do not apply, though these have been reduced in recent years as jobs shortages spread. To get a permit, employers must show they cannot source employees in Ireland. These permits are used by employers to fill lower-paid jobs in areas such as accommodation and hospitality, construction and agriculture.
A decision to offer fewer of these by tightening the criteria – would reduce immigration, but could also leave employers in these sectors struggling to find staff.
In the UK, prime minister Keir Starmer has said many businesses had become “addicted to importing cheap labour” and following a White Paper earlier this year his government is taking a range of measures to cut work permit immigration, including demanding higher education levels, cutting qualifying jobs, examining whether industries should be investing more in apprenticeships rather than importing workers, and demanding better standards of English.
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4. Cut student visas: According to the latest figures for the 2022/23 academic year, there were 35,140 overseas students in the higher education sector and 59,757 in further education, accounting for 14 and 32 per cent of total enrolments respectively. Non-EU nationals make up the majority of these. Many stay temporarily and return home afterwards, and they are vital to the funding of the third level sector. Cutting numbers would require the exchequer to fill the gap.
The Department of Finance report points out that a graduate stay-back scheme which allows highly-skilled graduates to stay and work in Ireland for two years after graduation now accounts for significant numbers. Like the permits for skilled employees, this is designed to attract talented people into the Irish workforce.
5. Tighten up the rules for families: Family members joining those already working here – and those granted asylum – are another significant contributor to the immigration figures, and the department report says they will become more important in the years to come and are likely to account for the biggest share of entrant numbers. A recent OECD report on migration shows the important of family migration internationally. The UK has also tightened up rules here. Ireland offers rights under various permit schemes for families to join people legally resident here. This is likely to become a focus of debate, given its likely importance in future immigration here.
6. The debate to come: In terms of non-asylum migration, the debate so far has often involved more heat than light. Even from Government there are contrasting signals – at the same time as calling for less immigration, Harris has conceded that part of the public service would collapse without it.
The debate is about two things. First, does Ireland want to retain a generally open approach to work permit immigration, to date a key part of our economic model? And second, wherever you stand on this argument, there is a need to look forensically at the different policy levers for the different types of permits and address the trade-offs involved in change.