Provocation 06: January 2008 The Difference Dividend Why immigration is vital to innovation By Charles Leadbeater Acknowledgements I would like to thank everyone at NESTA who helped me develop the arguments in this Provocation, especially Richard Halkett, Sami Mahroum, Richard Braham, Nick Bojas, Brune Poirson and Andrea Mattinson. I also learned a great deal and drew from the work of Phillipe Legrain, Robert Winder, Scott Page, Peter Hall and AnnaLee Saxenian. Errors and omissions are all my own. Contents How to miss a Black Hole 4 The Ins and Outs 7 The Innovation Benefi ts of Immigration 10 A long-term bet 15 Investing in connections 16 Making the most of our differences 18 Endnotes 21 NESTA is the National Endowment for Science, Technology and the Arts. Our aim is to transform the UK’s capacity for innovation. We invest in early-stage companies, inform innovation policy and encourage a culture that helps innovation to fl ourish. NESTA’s Provocations are regular extended essays by leading thinkers that showcase thought-provoking work on innovation. The views are those of the author and do not necessarily represent those of NESTA. If you would like to comment on this Provocation please e-mail [email protected] How to miss a Black Hole On the late afternoon of Friday though he presented little evidence to January 11th 1935, a brilliant, suggest Chandra was wrong. diminutive, 26 year old Indian physicist unveiled to the British scientifi c elite a The event cast a long shadow over radical theory that would revolutionise Chandra’s career. He was never offered our understanding of how the universe a full-time position at Cambridge and works: the idea of the black hole.1 eventually emigrated to the US where he spent most of the rest of his life at the That evening in 1935 Subramanyan University of Chicago. It took 40 years for Chandrasekhar dared to challenge the astrophysicists to catch up with Chandra’s conventional wisdom that stars die by theory and establish how black holes being reduced to a core of dead rock. He worked. Forty-fi ve years after giving his told the elite at the Royal Astronomical initial lecture Chandra was awarded the Society the gravitational forces unleashed Nobel Prize for physics. when a star dies could be so great that it could consume itself and so it would The story of Chandra’s treatment at the disappear into a ‘black hole’. hands of the Royal Astronomical Society highlights three critical connections Chandra’s mentor Sir Arthur Eddington between immigration, innovation (then the senior professor of astrophysics and creativity. First, immigrants are at Cambridge) had not discouraged outsiders who can often challenge the him from pursuing the idea, yet when establishment with ideas that might have Eddington rose to respond he tore into huge potential value. The diversity of the young Indian. Eddington ridiculed ideas and insights that immigrants bring the idea of a black hole as “stellar make a society richer. Second, closed buffoonery”. Naively Chandra had and homogenous societies – in this case imagined his fellow scientists would a single scientifi c society – can become welcome his contribution for opening up myopic and prejudiced and so fail to new horizons for research. Yet unwittingly spot vital ideas that come from unusual he had presented the establishment sources. Even a society full of very bright with a double whammy. To admit a black and able people can behave very stupidly. hole was possible would have entailed Third, how the UK makes the most of the their rethinking many of the theories on diverse talents of its population will be which their careers had been built. To be critical to innovation. Even though much forced to do so by a young Indian, at a has changed in Britain since the 1930s, time when the Raj still ruled India, would there are few grounds for complacency. have been regarded as a humiliation. The Yet the truth is that in almost all areas old guard rallied around Eddington even of the UK’s economy, immigrants have 4 The Difference Dividend Why immigration is vital to innovation made a critical, often highly innovative, theatre and fi lm is a roll call of immigrant contribution. creativity. Consider these greats of UK industry. Despite all this, immigration has become Triumph, the classic car company, the most visceral and controversial which made cars with names like Stag political issue of our times. Hardly a and Spitfi re, was founded by Siegfried day goes by without a newspaper story Bettman, born in Nuremburg in 1862. suggesting the number of immigrants has ICI was created by Brunner, a Swiss and been underestimated and questioning Mond, a German. GEC was founded whether they are entitled to be in the by two Bavarians. Jacob Schweppes UK. In the past year, immigrants have started making his fi zzy tonics at a been blamed for taking jobs from native factory in Drury Lane in 1792. Belfast applicants, claiming excessive benefi ts, is synonymous with the Harland and swamping public services, unpicking the Wolff shipyard which was founded by social fabric, undermining our national Germans. Thousands of weddings are identity and posing a threat to security kitted out by Moss Bros, founded by (in part because London’s private security immigrant Isaac Moses and his brother. industry seems to employ thousands Shami Ahmed (the founder of Joe Bloggs of illegal immigrants). The debate has jeans) arrived in Burnley at the age of touched whether the English football two. Gulan Kaderbhoy Noon, the inventor team would be improved by quotas of the Bombay Mix, arrived in the UK imposed on the number of foreign players from Rajasthan in 1969 and went on to in the cosmopolitan Premiership. make Noon products one of the major suppliers of ready-to-cook Indian food. Our lives are more open than ever to Hotel chains like Stakis (Cypriot) and foreign infl uences, especially in cities, Forte (Italian) were created by immigrant where we can sample music, food, culture families.2 and style from all over the world. And yet the physical presence of foreigners proves Immigrants have also left their mark deeply unsettling to many people. We on the creative and cultural industries. enjoy what immigrants produce, including Madame Tussauds, one of London’s many basic and personal services that UK greatest tourist attractions, was started citizens value but do not themselves want by Marie Grosholtz, a refugee from the to work on. Yet many Britons are not so French Revolution. Granada was created sure about immigrants. by Sydney Bernstein, in memory of a holiday in Spain, and ITV was shaped by The insistent note of anxiety that drums the Winogradsky brothers from Odessa, out the rhythm for the immigration better known as Leslie and Lew Grade. debate is sustained by a paucity of Even Audrey Hepburn, the epitome of dispassionate analysis compared with English chic, was half-Dutch. British other equally complex issues. The growing consensus about the threat of The Difference Dividend Why immigration is vital to innovation 5 global warming was created by detailed What is lacking from this debate is a studies such as the Stern Report and framework for assessing the costs and the Intergovernmental Panel on Climate benefi ts of immigration. That calculation Change. In 2005 the Turner Commission only becomes manageable once it is explained the looming pensions crisis and broken down. So this pamphlet looks at what should be done about it. Sir Derek just one issue: when and why immigration Wanless has led two extensive inquiries is good for innovation. into long-term trends for spending on health and social care. In contrast, the debate about immigration is conducted in a thick fog of prejudice, anecdote and rumour. A ‘Reader’s Digest’ survey in 2001 found that two-thirds of Britons thought there were too many immigrants. The survey respondents thought immigrants made up about 20 per cent of the population; the true fi gure was 4 per cent. Another poll found the average Briton believed the country was taking 25 per cent of the world’s refugees when the true fi gure was 2 per cent. In late 2006 the Government acknowledged its fi gures for the number of immigrants at work in the UK were inaccurate. As a result, the debate over immigration polarises. Those who defend the rights of immigrants to seek a better life argue we should welcome hard-working people who have chosen to come to the UK to fi ll vital skills gaps and take low skills jobs others do not want. Much more vociferous is the growing clamour of unease that immigrants are taking more than their fair share of public services, stretching the bonds of society, taking jobs away from local workers and adding precious little to the society that hosts them. 6 The Difference Dividend Why immigration is vital to innovation The Ins and Outs The main focus for the immigration abroad has risen from 75m to close to debate is whether there are too many 191m in the last three decades. The immigrants for society to cope with, as modern world may not be threatened by if they are like water fi lling up a vessel massive, world wars, but the rise in the with a fi xed capacity. number of protracted smaller civil wars has led to more people being displaced as The Offi ce for National Statistics asylum seekers and refugees. The UNHCR estimates about 510,000 migrants came estimates 17m displaced people are living to the UK for a stay of at least 12 months outside their homelands.