Thursday 4 April 2024

From 4 April, businesses wishing to hire overseas talent through the Skilled Worker Visa will need to pay staff at least a minimum of £38,700. This represents an increase of almost 50% from the current salary threshold of £26,200 and far exceeds the average salary for large parts of the country. At the same time, the going rate of pay for specific occupations, will increase to the median pay. An IT business analyst coming to the UK will now need to be paid nearly £52,000 to secure sponsorship under the skilled worker visa route (a rise of 38% on current rates).

The new thresholds have the potential to negatively impact the UK economy with manufacturing, construction and hospitality businesses among hardest hit industries.

Karim Fatehi MBE, Chief Executive of the London Chamber of Commerce and Industry (LCCI), said:

“Businesses are crucial drivers of the UK’s economic recovery, but without access to adequately skilled workers, fit for the 21^st Century, they will not be able to deliver the growth needed to lift living standards. Any decision which limits British businesses’ access to talent is not only bad for individual firms, but will ultimately be a blow to the UK’s economy and our future prosperity.

“One of London’s key competitive advantages is its ability to attract global talent in the most demanding professional fields. For London to maintain its position as the best city in the world for business, we must win the ongoing battle for talent.

“While we of course support initiatives to improve minimum salary requirements, this is a significant increase in the salary threshold, far above the UK average salary, which many businesses may not immediately be able to afford. In turn, this change could worsen the skills shortages faced by many sectors that are more reliant on foreign workers, such as construction and hospitality.

“If Britain is truly ‘open for business’ then we need a commensurate visa system to support it – this requires the Government to engage with businesses to understand what they really need going forwards to enable growth. Imposing greater costs on business that have suffered huge inflationary pressures for the last two years will only serve to hobble our nascent economic recovery.”

Louise Haycock, a Partner at Fragomen, the global immigration law firm, comments:

“There is a real concern that such rises will fetter London businesses’ access to overseas talent so critically needed at a point where there is high employment and a skills gaps. Restricting access to talent in such a way seems at odds with the declared desire for growth and ambitions to become, for example, an AI superpower. It also contrasts with other countries who are making it easier to hire foreign nationals into shortage roles or where there is an appetite for growth. The concern is that in aiming to reduce the numbers, the government are restricting access to talent and labour. It is no bad thing to show that UK earners are well paid, but issue is whether the system is moving too fast to allow the domestic economy to catch up and address labour shortages that arise as consequence.”

ENDS

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