Budget work immigration concessions offer hope to some suffering from skills shortages

17 March 2023

Following the Spring Budget 2023, Vanessa Ganguin, Managing Partner of Vanessa Ganguin Immigration Law, took a closer look at some of the work immigration measures that weren’t mentioned in the Chancellor’s speech.

Immigration and its place in the UK’s economic growth is clearly a contentious subject for the Conservative party. – So no surprise there was no mention of the subject in the Chancellor’s Budget Day speech. Yet the Treasury’s Spring Budget 2023 factsheet on Labour Market Measures published to coincide slipped out important business immigration news for UK employers.

On migration measures, the Treasury revealed: “we are supporting business to tackle labour shortages and improving business mobility.”

So what do these developments mean for UK employers?

Shortage Occupation List reviewed for Construction and Hospitality businesses

The construction and hospitality industries have been suffering greater than average job vacancies and had both been lobbying hard for these to be eased by adding them to the Shortage Occupation List.

Comparing the most recent three-month period (November -January 2023) with the immediate pre-pandemic period (January-March 2020), the MAC found vacancies 72% higher in hospitality and 65% higher in construction. This compares to an increase of 42% in the overall economy. Though the committee did point out in this week’s review that vacancies have been declining since the middle of 2022, overall now 13% lower than the peak.

The benefit to industries of having jobs on the SOL is being able to sponsor migrants for Skilled Worker visas on a lower minimum pay threshold and also at 20% less than the going rate. Skilled Worker visas are increasingly important for UK businesses ever since Brexit ended free movement with the EU.

However, while some construction sector jobs were added to the SOL, there was no relief for hospitality employers. The committee said that occupations it reviewed in the hospitality industry were of a lower skills threshold and would not join the Shortage Occupation List for now. There had been hope that chefs may go back on the list, but the committee said that the catering industry should improve pay and conditions to encourage and retain chefs from the domestic labour market.

Call for evidence

The Committee did however call on stakeholders to submit more robust evidenced submissions to its Call for evidence, ahead of a further review for the autumn, in which further occupations may be added to the SOL, perhaps holding out hope for more relief to employers finding it hard to fill skills shortages from the domestic jobs market.

For its interim report published to coincide with Jeremy Hunt’s Budget, the MAC looked at 26 occupations with going rates below the general threshold to be sponsored by an employer on a Skilled Worker visa. (The new threshold is £26,200).

New construction occupations on the Shortage Occupation List

The building industry occupations recommended for the SOL are bricklayers and masons; roofers, roof tilers and slaters; carpenters and joiners; plasterers – including dryliners now; as well as construction and building trades undertaking a variety of tasks in the construction, alteration, maintenance and repair of buildings, steeples, industrial chimneys and other tall structures, and of underwater structures, such as acoustician, builder, building contractor, fencer, maintenance manager (buildings and other structures); property developer (building construction). These urgent changes will take effect later this summer.

In its interim review, the MAC did not recommend adding steel erectors to the Shortage Occupation List as “based on projected pay growth it is likely that this occupation’s pay will be high enough for most jobs to meet the general threshold and therefore there is little justification for a SOL salary discount, which would risk undercutting domestic workers’ pay.”

Other construction occupations the MAC did not approve include scaffolders, stagers and riggers; road construction operatives; mobile machine drivers and operatives; and elementary construction occupations.

Business visitors to the UK

Also trailed in the Treasury’s Labour Market Measures document, employees of multinational companies, performers and global business people will have more scope for commercial activities in the UK of up to six months, with an Autumn expansion of permitted activities on a visit visa or by visitors from non-visa countries such as the USA and EU.