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Exclusive: Proposed UK immigration policies will hurt tech sector

Sam Shead | July 6, 2015
The Migration Advisory Committee is conducting a review into the minimum salary thresholds for the Tier 2 visa route - something which is likely to deprive the UK's tech-driven organisations of vital talent at a time when homegrown training initiatives are falling short.

UK flag in globe
The UK is arguably Europe's leading tech hub but strict immigration policies could change that. 

Proposed changes to UK immigration laws could make it harder and more expensive for technology-driven companies to hire people outside the EU for their UK offices, Techworld can reveal.

Technology-driven companies across the UK are forced to bring in talented programmers and software engineers from outside the EU because there is a shortage of skilled individuals at a national and continental level.

Although the skills shortage has long been recognised, government and industry initiatives have made little impact on the problem.

Yet Prime Minister David Cameron is still exploring the idea of further reducing the number of immigrants that can enter the UK on the skilled work visa - something that many technology companies depend on.

The government has asked the Migration Advisory Committee (MAC) to conduct a review into the "Tier 2" skilled work visa, which enables up to 20,700 skilled professionals to enter the UK every year from outside the EU.

The MAC is proposing that the minimum salary thresholds for the Tier 2 visa are raised, meaning UK-based technology-driven firms would have to pay more to hire talent from tech hubs like Silicon Valley and Bangalore in their UK offices.

Technology professionals working in the UK on the Tier 2 visa must currently be paid upwards of £30,000 (US$46,680) but the MAC is suggesting the minimum annual salary requirement for the Tier 2 visa is raised by anywhere between £10,000 and £25,000.

The likes of Google, Facebook and Amazon are renowned for paying their employees above average salaries in the UK (often in excess of £50,000) so the impact on them may not be huge. One area where these industry giants could be hit, however, is when they want to bring in high flying relatively young employees to the UK - either to fill skills gaps or enhance their experience.

A survey from salary benchmarking website in March found that Google pays juniors (those with 0-5 years experience) £40,000 a year on average, while Amazon pays £35,000.

Other UK based technology companies don't typically pay annual salaries of this magnitude. As a result, they'll either have to find more money to employ the people they want or let non-EU workers go.

The reforms to the Tier 2 visa - brought to Techworld's attention by immigration law firm Fragomen, which works with 80 percent of the world's largest technology companies and a number of Tech City firms - are to be submitted to Home Secretary Theresa May on 21 July, after she commissioned the public body to conduct a review of the Tier 2 route on 10 June.


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