The government has unveiled substantial changes to immigration rules unfolding over the course of 2024. In this blog, we discuss the implications of these changes on the tech industry.
Whilst it is certain that the changes will lead to decreased migration, they will also pose challenges for sectors reliant on the sponsorship system to fill skill gaps in the local job market.
Given the skills shortages in the UK’s labour market, many tech employers resort to sponsorship to address crucial job vacancies. The upcoming alterations have raised the general salary threshold for sponsorship to £38,700 and eliminate the Shortage Occupation List, which identifies roles in high demand domestically. A 20% salary reduction is offered for these positions.
Instead of the Shortage Occupation List, the Immigration Salary List has been introduced, featuring only about half the roles listed previously. Although roles on this new list will benefit from a salary discount of up to 20%, no tech roles seem to be included.
Previously, several tech positions, such as design and development engineers, IT programmers, software developers, and web design and development roles, were on the Shortage Occupation List. This inclusion lowered the minimum salary for sponsorship, with programmers and software developers requiring a minimum salary of £27,200.
However, since no tech roles are included in the new Immigration Salary List, as of 4th April, the minimum salary for sponsoring workers in these positions is now £38,700. The Migration Advisory Committee justifies this exclusion by citing that the median salary in the tech sector, based on data from the Office for National Statistics, exceeds £38,700, hence not qualifying for a salary discount.
Whilst larger businesses may already offer salaries that exceed sponsorship requirements, many smaller enterprises such as start-ups might not. Consequently, these changes will affect both recruitment and recruitment expenses, leading to significant increases. Overall, the UK Government’s policy and the subsequent rise in costs are likely to deter talented individuals from relocating to the UK. Employers may need to explore various strategies to attract talent, such as investing in graduate programmes to recruit fresh entrants into the labour market.
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The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please do not hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.
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