LONDON — Britain's net migration fell dramatically to 204,000 in the year ending June 2025, according to official figures released Thursday that show a drop of nearly 80% from the 2023 peak. The same day, the Labour government's much-touted Employment Rights Bill faced significant modifications as ministers abandoned their "day one" unfair dismissal pledge following opposition in the House of Lords .

The parallel developments represent both a policy victory and setback for Prime Minister Keir Starmer's government, which took office in July 2024 promising to reduce migration while enhancing workers' protections. The net migration figure—which measures the difference between people arriving and leaving the UK—now stands at its lowest level in half a decade and is roughly two-thirds lower than the previous year's 649,000 .

Sharp Decline in Net Migration

The Office for National Statistics (ONS) reported that the provisional estimate for long-term international net migration was 204,000 for the year ending June 2025, down from 649,000 in the previous year and a peak of 944,000 in the 12 months to March 2023 . This represents one of the most significant drops in migration figures in recent British history.

The decline is largely driven by fewer non-EU nationals arriving for work and study-related reasons, combined with a continued gradual increase in emigration. Non-EU+ immigration decreased by 37% compared to the previous year, with notable reductions in work dependants (down 65%) and study dependants (down approximately 85%) . These changes follow policy reforms implemented in early 2024 that restricted most overseas students from bringing family members and increased salary thresholds for Skilled Worker visas .

Changing Migration Patterns

The latest figures reveal shifting patterns in UK migration. Non-EU+ nationals accounted for 75% of total immigration (670,000 people), while both EU+ and British national groups saw more people leave than arrive. EU+ nationals' net migration was estimated at negative 70,000, continuing a downward trend since the 2016 EU referendum, while British nationals saw negative net migration of 109,000 .

The data shows 288,000 non-EU+ nationals came to the UK for study-related reasons, a 25% decrease from the previous year. Work-related immigration was the next most common reason at 171,000 people, representing a 61% decrease since the previous year . Meanwhile, immigration for asylum purposes increased from 81,000 people in the previous year to 96,000 .

Workers' Rights Policy Shift

In a separate development, the government has significantly modified its flagship Employment Rights Bill, abandoning the promised "day one" right not to be unfairly dismissed. Instead, during parliamentary "ping-pong" between the House of Commons and Lords, the government accepted an amendment establishing a six-month qualifying period before employees can claim unfair dismissal .

The original proposal had sparked concern among business groups about potential impacts on employer flexibility and hiring practices. The bill will also lift the current compensation cap for unfair dismissal, which limits compensation to 52 weeks' gross salary or a statutory cap, whichever is lower . According to the government's roadmap, these changes will take effect in 2027 .

Political Reactions and Analysis

Home Secretary Shabana Mahmood welcomed the migration figures, stating that net migration was "at its lowest level in half a decade and has fallen by more than two-thirds under this government" . However, she had earlier this month announced restrictive new measures, warning of "unprecedented levels of migration in recent years" and vowing that "that will now change" .

Shadow home secretary Chris Philp of the Conservative Party argued the fall was driven by reforms implemented by the previous Conservative government. "But we need to go much further," Philp added, saying that under a future Conservative government, "only those who make a real contribution can stay permanently" .

Migration experts cautioned that the decline might not be sustained long-term. Dr. Madeleine Sumption, director of the Migration Observatory at the University of Oxford, noted that a significant proportion of those leaving the UK are EU citizens who arrived before Brexit, which "won't go on forever" .

Broader Employment Reforms Proceed

Despite the retreat on "day one" rights, the Employment Rights Bill continues to advance other significant reforms. The legislation will introduce substantial restrictions on "fire and rehire" practices, making dismissals aimed at imposing changes to key contractual terms automatically unfair in most circumstances .

The bill also includes measures to:

• Create a right to guaranteed hours for workers on unpredictable contracts
• Establish a new Fair Work Agency in April 2026 as a single enforcement body
• Enhance protections for pregnant women and new mothers
• Implement new rules regarding trade union access to workplaces
• Collective redundancy consultation requirements will also be expanded, with the maximum protective award doubling to 180 days' pay, effective April 2026 .

The migration decline comes as the government prepares to implement further immigration restrictions announced earlier this year, including extending the qualifying period for indefinite leave to remain from five to ten years for most legal migrants . These changes are expected to take effect from spring 2026 after a consultation period ending in February .

For the Employment Rights Bill, further parliamentary scrutiny awaits as the legislation completes its passage through Parliament. The government has committed to additional consultations on various aspects of the bill, including collective redundancy measures and updates to the Code of Practice on fire and rehire .

As both policy areas continue to evolve, the Starmer government faces the challenge of balancing its pro-worker agenda with business concerns while managing migration levels that remain above historical averages, despite the recent sharp decline .