The UK Conservative Party’s plan to reduce the number of visas available to migrants each year — should it win the upcoming general election — could damage UK startups’ growth ambitions, say lobby groups, investors and founders.
Late last night, the party, which has been in power for 14 years, laid out plans to reduce net migration to the UK if it’s re-elected on July 4.
While the Conservatives have not set out precise figures for the cap on visas, the policy has drawn criticism from the UK startup sector, with some concerned that talent shortages could worsen, which could hamstring tech companies’ hiring plans.
“International talent has been a key part of the success of the UK’s startup ecosystem,” says Dom Hallas, CEO of lobby group Startup Coalition. “Any measures that restrict the flow of the best and brightest minds in tech to the UK to support and build companies would be a huge mistake.”
Slashing migration
Immigration is likely to be one of the key political issues for parties in the UK general election, and recent polling suggests that more than half of the UK population would like to see arrivals to the country reduced. The Conservative government has already implemented a series of reforms this year designed to curb net migration to the country.
It raised the minimum income required to sponsor someone coming to the UK on a family visa from £18.6k to £29k – an increase of more than 55%. The government also restricted postgraduate students and healthcare workers to bring dependents (like partners or other family members) with them to the UK. So far this year, there has been a 25% drop in people moving to the UK for work and study, according to recent data from the Home Office.
While bringing immigration numbers down might be popular with sections of the wider public, these changes have already led to major setbacks in recruiting talent from overseas, says Karoli Hindriks, CEO of employee relocation platform, Jobbatical.
“Startups in particular seem to be a forgotten group when it comes to policy setting, with recent moves from the current government hitting small businesses particularly hard. This latest plan [to reduce migrant visas] would be no exception,” she says.
The Conservative party could not be reached for comment. While the Labour party did not respond to a request for comment on its plans for tech talent visas, last week it announced plans to cut net migration to the UK.
Skills shortages
The UK tech sector relies on access to international talent to grow and maintain its leadership position, says Carolyn Dawson, CEO of UK non-profit startup group Tech Nation — the organisation which oversees the country’s Global Talent visa programme and has endorsed more than 5k arrivals to the UK through the scheme.
“[Migration allows] us to acquire the specific skills and expertise the UK needs now and for the future, and we wouldn’t want to see this capped,” she adds.
“Without a doubt” capping visas would harm UK startups, says Simon Phelan, founder and CEO of London-based energy services startup Hometree.
“My fear is that more founders would choose to start companies in the US,” he adds. “This [visa cap] would also impact the talent that UK tech companies can hire — there are already shortages of skilled developers with over one-third of UK businesses experiencing large internal tech skills shortages, rising to nearly half for tech businesses. Limiting immigration will only further increase these shortages.”
Last year, research found that 39% of the UK’s 100 fastest-growing companies were founded by foreign-born entrepreneurs. Fintech unicorns like Monzo, Revolut and Checkout.com all have migrant founders.
“Startups are built on talent, and UK startups have historically benefited heavily from being able to hire internationally, with little restriction,” says Imran Ghory, general partner at Blossom Capital. “It’s not just about securing talent to help existing UK startups grow but also about attracting individuals who will go on to found great British companies that are headquartered and create jobs and prosperity here.”
Hindriks says that Conservative party plans to cut migration to the UK “starkly contrast” to recent moves in countries like Germany that are trying to make it easier for skilled migrants to move there.
In June last year, Germany passed a series of reforms including a new streamlined visa process and lower salary and language ability thresholds. The cost of skilled worker visas in the country is 43 times lower than in the UK, according to Jobbatical data.
“Making the UK a hostile environment for global talent risks ceding our competitive edge to countries that are rolling out the red carpet for the world’s top professionals and entrepreneurs,” says Hindriks.
Read the orginal article: https://sifted.eu/articles/uk-migrant-visa-startups/
