UK immigration policy is holding back Yorkshire businesses: Jane Goddard
Immigration will doubtless be one of the key battlegrounds of the general election. But with several large banking and accountancy firms withdrawing graduate job offers from international students destined for the North of England, does the UK’s approach to business immigration need to change to reduce the economic disparity between the North and the South?
The fall of the ‘Red Wall’ in the 2019 general election shone a very bright spotlight on the economic disparities present in the UK.
Having promoted ‘Levelling Up’ as a key election promise, the Conservative government set about building policies to create economic parity between the North and the South.
Those policies are now under intense scrutiny, and more so following the decision to scrap key elements of HS2.
Less publicised but equally important is the disproportionate impact on northern economies of the government’s decision to increase the salary threshold for workers sponsored by an employer in the skilled worker programme by 47 per cent from £26,200 to £38,700.
Applied nationally and with no regard to the pay gap between London and the South East and the rest of the UK – the average salary for those in the North East is £31,200 - this increase effectively means many businesses are priced out of hiring overseas talent.
The employment of overseas specialists, along with investment in skills training is a small but critical component of boosting regional economies and its impact is already being felt.
Increasingly, immigration policy appears to be at odds with tax policy. The creation of investment zones such as the one in South Yorkshire, suggest that the government is willing to develop flexible tax policies to encourage businesses into regional areas.
Countries such as Canada and Australia have successfully used regional immigration strategies to boost local economies which could be replicated at home.
It is perhaps time to reframe the political rhetoric that surrounds business immigration, recognising the talent and skills international talent can bring to our regional economies.
Here are two ways the next government could do this.
First, the cost and burden of the current UK immigration system make it one of the most onerous and expensive in the world. While a system that operates efficiently does not come without a cost, the UK system is eye-wateringly expensive.
For the cost of the current system to be justified, greater flexibility, transparency and efficiency must be introduced. It must be a system that is truly reflective of the needs of all businesses, not just those in London and the South East.
Second, the very structures by which the immigration system is currently organised need an overhaul. There needs to be greater choice of visa categories as the current range and criteria that apply do not map into what is needed to secure the region’s growth prospects.
The solution is a comprehensive review of existing routes alongside businesses with the relevant sectoral and regional knowledge to establish key occupation shortages.
Above all, businesses need greater engagement from the government.
For nearly a decade, the policy concerns of business have been ignored by government, as politics have crowded out the sensible policymaking required to deliver a more prosperous future for Britain.
Nowhere is this more true than on immigration. Policy decisions appear to be made on the hoof with little or no consultation with businesses and without reference to existing policy direction. This exacerbates a sense of uncertainty, hardly a conducive environment for long-term planning and investment.
Jane Goddard is a practice leader in the Sheffield office of the global immigration law firm Fragomen.