Immigration is a pressing economic issue for Edinburgh - Joanne Davidson
Immigration is the political hot potato as we head to the polls next year in the Scottish Parliamentary election – with more than half of Scots polled recently saying immigration is too high.
While it is right to debate any issue – and immigration cannot be exempt from this scrutiny – it would be good to see greater balance, and in particular far greater analysis of the role played by immigration in our economy.
Because it is important to understand that far from being a drain on our economy, legal immigration has a positive impact on our finances – indeed the Office for Budget Responsibility regularly reports that higher net migration leads to reduced public finance deficits and lower debt. Not too surprising, when we consider that most immigrants are of working age, seek and gain employment and pay taxes and National Insurance.
Indeed, Scottish Government figures show that one in ten SMEs in Scotland has been established by immigrants.
In many parts of the UK - and particularly in Scotland and the Edinburgh city region – immigration will play a vital role in supporting future economic growth. A thriving economy depends on a diverse and skilled workforce, and immigration helps ensure we have the talent needed to drive innovation, productivity, and prosperity. It’s not just a social or political issue - it’s an economic imperative that underpins our ability to fund public services and sustain long-term growth.
Edinburgh and the Lothians are experiencing a demographic and economic transformation. Recent projections show that Edinburgh’s population is set to grow significantly over the next two decades, driven primarily by migration rather than natural increase.
Between 2012-22, net migration added over 53,000 people to the city, compared to just 5700 from births minus deaths. This trend is mirrored across the Lothians, where migration is the dominant force sustaining population growth.
The issue becomes more pressing when we consider that the city’s growth is highest among the elderly. In other words, the population is growing and ageing, with consequent greater needs for health and social care services and fewer people of working age to generate the money needed to fund the demand.
While immigration policy remains reserved to the UK Government, there is a legitimate case for Scotland - and particularly the Edinburgh region - to have a stronger voice in shaping how immigration supports local economic needs.
There are nations where there is a more nuanced approach, offering arguments for the expansion of regional levers when it comes to immigration.
Canada’s Provincial Nominee Program allows provinces to select immigrants based on local criteria, leading to high retention and economic integration.
Australia’s state-sponsored visas target regional labour shortages, while New Zealand uses regional skill shortage lists to direct immigration where it’s needed most. These systems demonstrate that regional levers can enhance responsiveness, retention, and economic impact.
In Scotland, the idea of a regional visa system has gained traction. Proposals include a Scottish Visa or devolved powers to set criteria for specific sectors and geographies.
Critics argue that enforcement and internal migration pose challenges, but evidence from Canada and Australia shows that with the right incentives and support, regional retention can be achievable.
Edinburgh’s economy is diverse and dynamic, with thriving sectors in finance, tech, tourism, education and healthcare. Each of these faces unique labour market pressures that national immigration policy often fails to address.
For example, the city’s hospitality sector depends heavily on migrant workers while the NHS and social care services struggle to recruit and retain staff including nurses, dentists and doctors.
A regional immigration system could respond more nimbly to these needs, ensuring that visas and pathways align with local demand.
Ultimately, Edinburgh and the Lothians need immigration - but not just in volume - it needs to be with precision. A regional immigration lever would empower local authorities to shape policy around real-time data, economic forecasts, and community needs.
It would allow the region to attract the right talent, support public services, and sustain growth in a way that national policy alone cannot.