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Forecasters in both the US and the UK say that net zero is about to happen. Net zero migration that is. The predictions raise two questions. Are they plausible? And is a rebalancing of migration flows an economic and political triumph or a disaster?
On the first question, it is important not to confuse plausibility with certainty. The approach of net zero is plausible, but the data is poorly measured in both countries and net migration figures are extremely sensitive to small errors in guessing immigration or emigration.
In the US, Brookings estimates that net migration turned negative in 2025, while the Congressional Budget Office thinks there were over 400,000 net immigrants. The difference results from a relatively small disagreement over the level of deportations last year and whether this action by Donald Trump’s Immigration and Customs Enforcement agency encouraged other migrants to up sticks or not.
The UK data is just as problematic. Following lower than expected official net migration figures of 204,000 in the year ending last June, James Bowes, a researcher at the University of Warwick, forecasts net zero migration this year. The Migration Observatory at Oxford university instead thinks it will fall temporarily to a little over 250,000 this year before rising to 340,000 by the end of the decade.
Here, the difference stems mostly from a guess about the proportion of foreign graduates and people with work visas who came to the UK in a 2022 surge staying on in 2026. They also rest on official estimates of the movement of UK nationals, which stem from a heroic interpretation of tax and social security records. If you don’t bother the tax system for a few years, statisticians will assume you have emigrated. This is important in the calculation of net migration, but could be horribly wrong.
You might think the politics of lower net migration is easy. In America, it has been. Speaking at the World Economic Forum this week, Trump bragged that the US had achieved reverse migration for the first time in 50 years — “boy that was nice”. The Department of Homeland Security might have been cavalier with its use of numbers, but was happy to describe a rise in “self deportations” as “historic”. It is trickier in the UK. Even though the prime minister said the drop in UK net migration was “a step in the right direction”, voices on the right framed the departure of UK, Polish and Romanian nationals as an indictment of his government’s record.
Net zero has multiple economic consequences. The first is for rules of thumb. Instead of thinking it is normal for the US economy to create around 150,000 jobs a month, as was true in 2023 and 2024, that figure is now plausibly zero or even negative. Net zero would also wipe out three-quarters of UK adult population growth.
Fewer people and jobs would have a significant effect on GDP growth. Brookings estimates that US potential growth would drop by around 0.2 percentage points, while net zero in the UK would have a larger effect because the drop is more significant relative to population size. The OBR estimates that adult population growth contributes 0.7 percentage points to the UK’s potential growth rate and so potentially 0.5 percentage points of growth per year are at stake.
With migrants contributing tax revenue and visa fees, but eligible for few state benefits, net zero has immediate fiscal effects, which again would be larger in the UK. A one-off drop in 2026 would not make much difference but if the longer-term net migration rate fell from 340,000 to zero, it would put the government’s fiscal rules in jeopardy, according to the OBR, even with the additional headroom Rachel Reeves added in the Budget.
That said, it is important not to exaggerate the effects. Lower GDP spread among fewer people implies little change in living standards. Monetary policy is also broadly unaffected because lower migration limits labour supply but also labour demand and consumption, leaving the effects on inflation muted.
Fiscal policy is different, though. The public finances take an unambiguous hit in the short term, making fiscal rules in the UK or deficit reduction in the US harder to achieve.
For the longer term, however, recent dynamic modelling suggests net migration has a far less favourable impact on the public finances once pension rights and healthcare costs in old age are included. Lower net migration is therefore one of those rare events when governments improve the long-term outlook of public finances at the expense of the time they are in office.