Business immigration rules changes are a ‘reckless act of national self-harm’

15 March 2024

Immigration experts have warned that some sectors are likely to be priced out of the market for new sponsored workers, under the changes to immigration rules detailed in the Statement of Changes issued by ministers yesterday (14 March). One specialist has described the changes as a ‘reckless act of national self-harm’.

The government announced in December 2023, in the wake of record net immigration figures, that salary thresholds and “going rates” would significantly increase from 4 April 2024. The minimum salary rate is being increased by 48% from £26,200 to £38,700 a year from April.

The Shortage Occupation List (SOL) is being replaced by an Immigration Salary List (ISL) with 21 roles – down from 54 on the SOL. This number represents only 8% of job roles eligible for the skilled worker immigration route. Previously, about 30% of job roles eligible for the skilled worker route were on the SOL.

Although the 20% discount to the threshold rate (£38,700) has been retained for jobs on the new list, there is no discount to the going rate which can often be much higher…

Immigration law specialist Vanessa Ganguin says that “making Britain’s post-Brexit immigration system less affordable right now would seem a reckless act of national self-harm at a time this nation could really do without it”.

As we have seen, small and medium-sized firms, including the IT sector, were likely to be badly hit by the changes. The steep rises in the pay threshold were “not a nightmare perhaps for the big tech brands in the capital, but punitive for tech start-ups and employers outside the capital that can’t pay London wages,” says Ganguin.

Ganguin pointed out that under the Shortage Occupation List fishing boat operators were able to sponsor deckhands on large fishing vessels from £14,400. From April they would have to pay £30,960 – an enormous amount of extra cost for an industry already hit hard by Brexit.

She warned that immigration lawyers were noticing a “chilling effect” on clients and projects outside London.

“One of our clients is involved in delivering flagship engineering projects to secure Britain’s energy independence. They are very concerned that the current £31,440 salary they would have to pay an electrical engineer they hire on a skilled worker visa is set to leap up to in the region of £53,500 in April.

Ganguin says: “The government commissioned the Migration Advisory Committee to review replacing the Shortage Occupation List but has ignored the advice it came back with to reconsider removing the 20% going rate discount for shortage occupations.”

The rises in immigration have been at least partly fuelled by skills shortages, particularly in healthcare, she adds. “Skilled Worker visas actually fell 1% in 2023, while Health and Care visa grants almost doubled year on year (+91%) to 146,477. But it is British private sector businesses that bear the brunt of the government’s hike in the cost of filling skills gaps with non-resident labour.”