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Last year, net migration led to the highest annual population growth in England and Wales for 75 years, with births falling to their lowest level in two decades, highlighting the changing demographic pressures facing Sir Keir Starmer’s government.
The population of England and Wales increased by almost 610,000 people to 60.9 million in the year to mid-2023, the Office for National Statistics said on Monday, the biggest annual increase since 1948.
According to the statistics agency, the population growth was helped by the fact that 622,000 more people immigrated than emigrated during this period.
At the same time, the number of births, at 598,400, was the lowest in 21 years, contributing to the smallest “natural change” (defined as total births minus total deaths) since 1978.
Experts say immigration can mitigate the impact of population aging on the economy and public finances because it can increase the share of people of working age.
But the last Conservative government came under intense political pressure because of a sharp rise in net migration to the UK towards the end of its term.
In its manifesto, Labour did not set a target for net migration, which fell by 10% to 685,000 by 2023. But ahead of the election, Starmer’s party pledged to “reduce reliance on foreign workers”. [and] “Addressing local skills shortages”.
Tony Travers, a professor at the London School of Economics, said the ONS data meant the new government would either have to “live with a relatively high level of net international immigration” or “find a way to re-engage those who are living here but not in the labour market”.
“International immigration is a relatively simple way to address labor shortages, but there is a gap between what you can tolerate politically and what the economy needs,” he added.
The decline in births is associated with a decrease in the share of the working-age population and an increase in the proportion of elderly people.
Figures released on Monday showed the number of people aged 75 to 79 increased by 4.5 per cent, or around 110,000, in the year to mid-2023.
Over the same period, growth in the overall population stood at 1%, while the working-age population – which includes those aged 20 to 65 – stagnated.
With the exception of London and the West Midlands, all regions in England and Wales recorded more deaths than births, the ONS said.
Some economists have highlighted the benefits of a “longevity dividend” – or capitalising on healthier older generations – but others have warned of increased pressures on public finances and economic growth.
According to Travers, with the working-age population’s share of the total population falling, “the tax burden is likely to fall more heavily on those in work, unless growth can be stimulated through higher productivity.”
Last week, a UN report revealed that one in four people in the world live in a country where the population has already reached its peak, including China, Germany and Japan.
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Madeleine Sumption, director of the Migration Observatory at Oxford University, said population growth in England and Wales had “contributed to rising housing costs in a country where housebuilding has not kept pace”.
But she added that higher population density could “have positive effects on innovation and productivity and greater migration can help public finances.”
With new visa rules introduced by the last government likely to reduce domestic immigration levels this year, Sumption said the most recent population growth rate was “not likely to persist”.
