Does Britain need migrant workers?
Since 2020 Britain's non-EU foreign workforce has grown to 3.2m—more than double its pre-pandemic size. That has fuelled anti-immigrant sentiment. The upside is a more productive and richer economy. More than one in five working-age Britons are neither employed nor seeking work; foreigners have filled the gaps. In 2022 the average migrant on a skilled-worker visa contributed a net £16,300 ($20,150) to the public purse, compared with £800 for the average Brit. The Centre for Economics and Business Research, a consultancy, reckons zero net migration that year would have resulted in a 0.94% drop in GDP in 2025.
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Reuters
2 hours ago
- Reuters
The path to cheap power will be very expensive
LONDON, June 9 - Europe's ambition to develop cheap, clean energy has recently received a harsh reality check, as power failures and a string of cancelled renewables projects made it clear that the road to inexpensive power will carry a very high price tag. European investments in renewable energy have risen sharply over the past decade as governments have begun implementing policies to reduce greenhouse gas emissions – an effort that sped up after Russia's invasion of Ukraine created an energy price shock. The share of renewables in the EU's power sector rose to 47% in 2024 from 34% in 2019, with a record 168 gigawatts (GW) of solar and 44 GW of wind power capacities installed between 2022 and 2024 alone, according to EU data. In Britain, renewable generation exceeded 50% for the first time in 2024, data showed. But investment in grid infrastructure, including pylons, cables, transformers and battery storage technology, has barely kept up with the rapid change in the power generation mix. Between 40% and 55% of low-voltage lines will exceed the age of 40 by 2030, while their length increased only by 0.8% between 2021 and 2022, according to a European Commission report. The Commission last week issued guidance for developing electricity networks in which it estimated the bloc will require 730 billion euro of investments in power distribution and another 477 billion euro in transmission grid developments by 2040. The underinvestment in grid infrastructure has created strain in many systems, a risk that was laid bare on April 28, with the catastrophic blackout in the Iberian Peninsula. Regulators are still investigating exactly what triggered the collapse of the power systems in Spain and Portugal. But what is known for sure is that the outage was preceded by the disconnection of two solar farms in southern Spain. The Spanish system is heavily reliant on renewables, but the issue was not the energy source itself. Rather, the problem was that the grid system had not been updated to account for the fact that solar-powered plants, unlike those using fossil fuels, do not generate inertia – the kinetic energy created by the rotation of spinning generators – which can help stabilize a grid in the event of power disturbances. To overcome this challenge, operators would need to invest in technologies such as synchronous condensers or batteries that kick in within milliseconds in the event of an outage to offer backup. The Iberian debacle puts a spotlight on the fact that more investment is needed in the mundane, but vital, elements of grid infrastructure. Another reality check for Europe has been the realization that offshore wind – once heralded as a potential renewables game changer – simply has lousy economics today. Danish offshore wind giant Orsted on May 7 cancelled a major project off the eastern coast of Britain, Hornsey 4, dealing a blow to the country's ambitions to develop 50 GW of clean power capacity by 2050. The recent rise in material costs forced the cancellation, according to Orsted, which had already sunk 5.5 billion Danish crowns ($840.5 million) into the project. And then on May 16, the Dutch government postponed tenders for two offshore wind farms with a total capacity of 2 GW due to a lack of interest from potential bidders. Several companies said they saw no viable business case for the projects, which offered developers no government subsidies. These two cases suggest that capital-intensive projects like offshore wind simply won't make economic sense without more ambitious government policy initiatives. The challenge is not unique to Europe. While worldwide investment in clean technology has risen, the headline figures mask a less rosy picture. The International Energy Agency (IEA) said in a report published on June 5 that global investment in power grids reached a record $390 billion in 2024 and is set to surpass $400 billion in 2025, 20% higher than a decade ago. But spending on power grid upgrades has not kept up. In 2016, about 60 cents were invested in grids for every dollar spent on new generation capacity. That ratio has dropped to less than 40 cents as the costs of renewables has declined, according to the IEA. This imbalance is unsustainable as ageing Western power systems – especially those in Europe – will increasingly experience problems unless trillions are spent in grid upgrades. The investment shortfall partly reflects a fundamental time horizon mismatch. Governments face public pressure every time energy bills – or taxes – rise, so they will struggle to convey to voters the long-term benefits of spending billions in tax dollars to support building modern, low-carbon power systems. But energy companies and utilities seeking to invest in renewables and grids will need long-term policy certainty, and given the challenging economics for many renewables projects, they will often also require generous subsidies. To be sure, the long-term costs of inaction to mitigate climate change will be far higher, and the EU is already spending over 100 billion euros annually on fossil fuels subsidies. But long-term thinking is not an easy sell for politicians in a time of growing populism, nationalism and polarization. Ultimately, if European governments want their populations to have cheap, green energy, they will need to accept the reality that getting there will be more expensive and more government-driven than previously advertised. Enjoying this column? Check out Reuters Open Interest (ROI), opens new tab, your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis. Markets are moving faster than ever. ROI, opens new tab can help you keep up. Follow ROI on LinkedIn, opens new tab and X., opens new tab
Reuters
3 hours ago
- Reuters
Breakingviews - The EU can play it cool with Trump's trade threats
LONDON, June 9 (Reuters Breakingviews) - Other governments have so far taken three main approaches to dealing with Donald Trump's trade threats. China hit back hard at the U.S. president's tariffs and got him to back down partly. Canada also retaliated and avoided some of the pain Trump inflicted on other countries. Meanwhile, Britain cut a quick deal that favoured the United States. None of these is a model for the European Union. The 27-member group is not China. Though its bilateral goods trade, opens new tab with the United States last year was worth 70% more than between the U.S. and the People's Republic, opens new tab, the EU is not an autocracy that can outpunch Trump. If it antagonises the U.S. president, he might up the stakes by pulling the rug from under Ukraine and undermining the EU's defences. American hard power gives it what geopolitical strategists call 'escalation dominance'. The EU is not Canada either. Ottawa was able to hang tough because its people were infuriated that Trump was trying to blackmail Canada into becoming part of the United States. While anti-Trump sentiment is high, opens new tab in the EU, politicians who are sympathetic to him, such as Poland's new president, can still get elected. On the other hand, the EU is not the United Kingdom. Both are at risk from Russia's invasion of Ukraine. But the EU trades seven times more goods with the United States than Britain, opens new tab does - so Washington has more to lose if economic relations break down. There is another way for the EU to handle Trump's threats: play it cool. That is more or less what the bloc is doing. It involves neither escalating the conflict nor accepting a bad deal. It means being open to a good agreement if the U.S. lowers its demands, but willing to play the long game if it does not. One reason to buy time is to help Kyiv. The longer the EU has to prepare its own support package for Ukraine, which should include getting it a lot of cash, the less the damage if Trump ultimately cuts off all U.S. aid to the country. The president's own vulnerabilities may also increase over time. Just look at the spectacular end of his alliance with Tesla (TSLA.O), opens new tab boss Elon Musk. The fragile U.S. trade truce with China may break down causing more financial turmoil, making Trump less keen to pick a fight with the EU. If the Supreme Court stops him using emergency powers to impose tariffs, his negotiating position will be weaker. And tariffs could hurt the U.S. more than its supposed victims, by pushing up inflation and crimping growth. Trump has zig-zagged in his trade threats and actions against the EU. The current state of play is that there are 50% tariffs on U.S. imports of steel and aluminium from the bloc, a 25% tariff on cars and 10% so-called reciprocal tariffs on most other goods. The U.S. president has threatened to jack up these reciprocal tariffs to 50% if there is no deal by July 9. He is also looking at more 'sectoral tariffs', including on pharmaceuticals and semiconductors. While the EU has complained to the World Trade Organization (WTO), it has delayed its own retaliation. Its negotiators accept that they are unlikely to overturn the reciprocal tariffs, the Financial Times, opens new tab has reported. The bloc still aims to avoid the sectoral ones. Those on cars and any on pharmaceuticals would hurt it the most. It has dangled the possibility of buying more U.S. equipment and natural gas to get a deal. An agreement on those lines could be good for the EU. It needs to beef up its defences and eliminate its purchases of Russian gas. While it would be best to have its own arms and energy supplies, buying more from the U.S. makes sense as an interim measure. An important nuance, though, is that the EU should reserve the right to take action against the reciprocal tariffs after the WTO issues its verdict, says Ignacio Garcia Bercero, opens new tab, a former senior EU trade official. Such a pact would involve quite a climbdown by Trump. True, arms and gas purchases would narrow the U.S. goods deficit with the EU, which was $236 billion, opens new tab last year. But his administration has a host of other complaints including the bloc's value-added tax and food safety standards as well the digital taxes that some of its members impose on tech giants. It is hard to see the bloc agreeing anything in those areas, says Simon Evenett, professor of geopolitics and strategy at IMD. Although the U.S. side described last week's trade talks with the EU as 'very constructive, opens new tab', discussions could easily break down. The question then is how the bloc would react if Trump imposed higher reciprocal tariffs. The EU has so far imposed no countermeasures. Though it has agreed to tax 21 billion euros of U.S. imports in response to the steel and aluminium tariffs, it has delayed these until July 14 to try to get a deal. The European Commission, its executive arm, is also consulting on taxing a further 95 billion euros of U.S. imports in response to the car tariffs and the reciprocal ones. But added together, these tit-for-tat measures would be equivalent to only a third of the 379 billion euros of EU imports subject to Trump's tariffs. Some analysts, opens new tab think the bloc needs to be tougher. One idea is to crack down on American services, where the U.S. had a 109 billion euro, opens new tab surplus with the EU in 2023. Another is to activate its 'anti-coercion instrument, opens new tab', which would allow retaliation against U.S. companies operating in the bloc. Yet another is to threaten to ban exports of critical goods, such as the lithographic equipment necessary to make semiconductors. Extreme events may require extreme responses. But for now, the EU should keep its cool. It should not kid itself that it is stronger or more united than it is. It should remember that Trump may get weaker with time. And it should never forget Ukraine. Follow @Hugodixon, opens new tab on X
Auto Blog
8 hours ago
- Auto Blog
Tesla Just Bucked An EV Trend In Europe, And It's A Huge Problem For The Company
Tesla will use its Model Y as a launching platform for its robotaxi tech Sales of EVs are up in Europe, but Tesla's numbers are dropping fast Sales of EVs are up in Europe, but Tesla's numbers are dropping fast Tesla's reputation has taken a significant hit since January, when CEO Elon Musk created the DOGE task force, billed as a means to decrease spending across the United States government. In doing so, Musk damaged his standing with the public, which has carried over to Tesla. New data shows that Tesla's reputational hit is not limited to the United States, as sales in Europe are down for Tesla amid a surging electric vehicle market. 2025 Ford Maverick: 4 reasons to love it, 2 reasons to think twice Watch More According to the European Automobile Manufacturers' Association, sales of battery electric vehicles across the European Union (EU) increased by 26.4 percent in 2025 compared to 2024, year-to-date. Tesla registrations in the EU have declined by 46.1 percent through April 2025, with a 52.6 percent year-over-year decrease in April alone. Tesla store in Austin, Texas — Source: Tesla Tesla by the numbers For 2025 (January through April; all figures are year-over-year comparisons), Tesla has sold 41,677 units. In the same period in 2024, Tesla registrations (sales) were 77,314 units. If this downward trend continues, Tesla will be one of the five worst-selling brands in the EU by mid-2025. In April alone, Tesla only sold 5,475 vehicles in the EU. Though the European Automobile Manufacturers' Association didn't break out its data by month, it's easy to conclude Tesla sales have been in decline since the beginning of the year. If April were a 'normal' month, Tesla would have sold about 22,000 vehicles in the EU. Expanding the scope doesn't help much. In the EU, the UK, and across the European Free Trade Association (EFTA), which includes Iceland, Liechtenstein, Norway, and Switzerland, Tesla sold 61,320 vehicles compared to 100,255 in the same timeframe in 2024, representing a 38.8 percent decline. In April, Tesla sold 7,261 vehicles, down from 14,228 last year, signaling a 49 percent drop. Autoblog Newsletter Autoblog brings you car news; expert reviews and exciting pictures and video. Research and compare vehicles, too. Sign up or sign in with Google Facebook Microsoft Apple By signing up I agree to the Terms of Use and acknowledge that I have read the Privacy Policy . You may unsubscribe from email communication at anytime. EV sales in the EU are up Battery-electric vehicle sales in the EU from January through April 2025 are up 26.4 percent, which is the same percentage decline for ICE vehicles, suggesting that Europe is embracing the concept of replacing combustion engine vehicles with EVs. France and Estonia were the only countries to experience a decline in EV registrations year over year. EVs account for only 15.3 percent of the market in the EU, trailing behind petrol vehicles (28.6 percent) and hybrids (35.3 percent). Though total car sales dipped 1.2 percent year to date, EV sales were up 3.3 percent. Diesel and petrol sales have dropped over ten percent year over year. Tesla Model 3 Performance — Source: Tesla Final thoughts As Elon Musk quietly slips away from his work in government, the damage done to Tesla may be irreversible. Less than ten percent of overall Tesla sales occurred in one out of four months in 2025, which is an indicator that Tesla is a brand non grata in Europe and sales are declining sharply every month. Upstart Chinese automaker BYD, a brand some consider Tesla's main existential threat, outsold Tesla in the EU in April by about 60 cars, according to data from analyst firm JATO. BYD doesn't have a vehicle in the top 10, according to JATO, but both of Tesla's main vehicles – the Model Y and Model 3 – saw sales decline 49 percent and 41 percent, respectively. About the Author Nate Swanner View Profile
