Revealed: The plan to keep EU workers in Scotland

The landmark report has been welcomed by the Scottish Government who described the current UK-wide approach to immigration as “damaging to Scotland’s economy”.

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Business leaders fear the end to freedom of movement and hardline cuts to UK-wide immigration targets following Brexit will spark crippling labour shortages in Scotland.

It comes hours after David Davis was accused of performing a “humiliating U-turn” after agreeing to Brussels’s sequencing timetable on the first day of the Brexit talks.

Brexit Secretary David Davis exchanging mountaineering gifts with European Commission's chief negotiator Michel Barnier

The Brexit Secretary had initially suggested that talks on a future trade deal could be sequenced alongside other issues but he abandoned this gambit, meaning that the negotiations with the other European countries will now focus initially on the UK’s divorce bill, the rights of EU nationals and the border issue with Ireland.

Mr Davis rejected accusations of a climb down arguing that trade talks would take place in parallel with negotiations on the arrangements for withdrawal at a later stage.

Read more: Davis accused of ceding first victory to Brussels after "humiliating" climbdown on talks timetable

But Tim Farron, the Liberal Democrat leader, said: “David Davis said the row of the summer would be over the sequencing of Brexit talks and, one day in, he has capitulated.”

He added: “The man is a joker. Despite the Government’s posturing, the EU was clear today it has not made a single concession to David Davis. He has been utterly humiliated.”

However today, researchers led by Professor Christina Boswell will publish a keystone paper on how the Scottish Government’s economic need for more migrants can be squared with the British administration’s political desire for fewer.

In a stark sign of Scottish vulnerability to a UK-wide crackdown on foreign workers, the latest figures show nearly one in five Scottish hotel employees come from other EU states.

The experts believe Britain’s existing Tier 2 working visas – which will apply to EU nationals after Brexit – could be tweaked to allow desperately needed workers with lower skills to take up jobs in Scotland, from picking strawberries to pulling pints, but not in England and Wales.

While politicians backing immigration more frequently talk about luring educated specialists north of the Border the country needs just as many young and unskilled employees.

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Scottish immigration is “U-shaped”, say Professor Boswell and her fellow experts, with new workers concentrated at either end of the skills scale.

The Tier 2 proposals – effectively creating marginally different work permits north and south of the border – are designed to overcome political blocks on more practical devolved solutions at Westminster.

Ms Boswell and her colleagues said: “There are a number of promising channels for meeting Scotland’s needs which do not require a radical overhaul of current arrangements. The challenges in realising them reflect the heat of debate on immigration more than the practical difficulties of implementing them.”

Their views are published in The Herald as we resume our Beyond Brexit series looking behind the rhetoric at potential means of mitigating the real challenges posed to Scotland by the UK’s vote, a year ago this week, to leave the European Union.

Last year our series included expert testimony from David Bell, professor of economics at Stirling University, who warned UK Government plans to cut net immigration to the “tens of thousands” could push Scotland back to the tragic decades from the 1960s to the 1990s when the country’s population dropped by 600,000.

The last 13-14 years of mass immigration – mostly from the new EU nations of central Europe and England – have seen Scotland’s population grow to a record high with unemployment far lower than previously.

But net inflows of from the rest of the UK – currently some 6000 people a year – would not be nearly enough to protect business and counter Scotland’s fast-ageing population, Prof Bell said.

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SNP ministers have argued for powers over immigration to be devolved but face stiff resistance from Westminster amid concerns that Scotland could open a “back door” for foreigners to move to England, where public anti-migrant sentiment is stronger than north of the border.

Last night, Alasdair Allan, Minister for International Development and Europe, said the University of Edinburgh report was a “valuable contribution” to the debate on the “need for sensible immigration policies”.

He added: “The current UK-wide approach is not fit for purpose and is damaging to Scotland’s economy.

“We have long called for immigration policies that are tailored to meet Scotland’s own needs and circumstances, which encourage the best and brightest to come and make Scotland their home, welcoming the many contributions they can make to our economy and society.”

However, some Tory voices, including Holyrood opposition leader Ruth Davidson, have struck a different tone. Ms Davidson accused the SNP of making Scotland “uniquely unattractive” for migrants – though her claim only four percent of foreigners moving to the went north of the border proved to be inaccurate.

Labour before the election also spoke of a post-Brexit visa scheme for unskilled workers.

Prof Boswell and her University of Edinburgh colleagues Sarah Kyambi and Saskia Smellie have come up with ideas they hope can take some of the heat out of Scottish immigration politics.

They admit the kind of devolved schemes that would suit Scotland best – such as the points-based system used by regions in Australia and Canada – would be the most difficult to sell politically.

These, after all, are systems put in place in what are “settler nations” with high levels of tolerance of foreigners arriving to live and work and a tradition of flexible federalism.

Devolved immigration schemes such as in Quebec, the “nation within Canada”, would be practically viable, but would need a substantial shift in public perceptions and a real shift from the UK Government.

Prof Boswell and her colleagues, therefore, believe their Tier 2 visa adjustments and a renewal of post-study work visas – a scheme pioneered by former Scottish Labour First Minister Jack McConnell – are more politically realistic.

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Scottish Government officials are understood to have been briefed on the Edinburgh University paper.

The experts, meanwhile, call for Scotland to get its own Migration Advisory Committee, the body which currently identifies gaps in the labour market that need filled by overseas workers.

They did so as it emerged that even the prospect of Brexit has made Britain less attractive to foreigners, thanks, say critics, to anti-migrant rhetoric and the post Leave vote crash in the value of Sterling.

Net immigration from the eight nations to join the EU in 2004 last year fell to just 5000. Emigration from the UK rose 12 per cent as 117,000 EU8 nationals left the country. Only 46 EU nurses registered to practise in Britain in April, a 96 per cent reduction.

These figures do no reflect the full impact of the Brexit vote and there are concerns that Scottish-only numbers are not robust.

Some numbers on EU citizens in Scotland

* There are 181,000 people from EU nations living in Scotland, as of 2015, nearly half of them are Polish. Ireland, Spain and Italy are the next biggest source of migrants.

* Four out of five EU-born Scots are of working age, far more than the figure of 66 per cent for British-born Scottish residents.

* EU nationals earn an average of £8.60 per hour, compared with an average of £11.10 for all employees in Scotland.

*One in four small and medium-sized firms say they have at least one worker from another EU nation, according to the Federation of Small Businesses. That number rises to 45 per cent of firms in the tourism sector.

* A quarter of all workers in the food-processing industry and 19.5 per cent of those in accommodation services are from the EU.

* Only four per cent of EU citizens in Scotland are over 65, compared with 18 per cent of the population as a whole. EU nationals are less likely to be unemployed than the national average.

* Scotland is far more reliant on EU nationals than England and Wales for population growth. EU nationals accounted for half of Scotland’s net rise in population, according to Holyrood analysis of UK statistics for 2016. The equivalent for the rest of the UK was 37 per cent.

* EU nationals tend to be better educated than Scots. More than a third of them have degrees, compared with just over a quarter of UK citizens resident in Scotland.

* A quarter of EU nationals are working in “elementary occupations” compared with just three per cent of the population as a whole.

* Scotland has attracted an average of six per cent of EU migrants to the UK in recent years, lower than its share of the British population of more than eight per cent.