The Government's latest quarterly migration figures show just a 2% increase in the number of Tier 2 work visas issued this quarter. In a world of increasingly globalised business and talent, the question is why skilled workers are not more attracted to the UK.
In April 2011, the UK Government implemented large changes to its immigration policy, closing the Tier 1 Highly Skilled Migration Policy (HSMP) and the Tier 1 Post-Study categories, and increasing barriers and fees for companies sponsoring Tier 2 visas, among other things. This has made moving to or staying in the UK nearly impossible for many skilled workers.
Foreigners educated at British institutions must leave the country if they cannot find an employer to hire and sponsor them for a visa. Many employers, already bearing the burden of a prolonged recession, are reluctant to splurge on the fees and administration necessary to sponsor foreign workers. This means that many of the best and brightest have no option but to return to their home countries to start and build businesses away from British shores. For those from abroad considering international work opportunities, the UK now looks less attractive than more immigration-friendly nations like Singapore or Hong Kong.
UK GDP growth is forecast to be -0.1% in 2013, while unemployment sits at 7.8%. Speak to any business professional, a FTSE 100 executive or a start-up founder, and they cannot find local talent to support the growth of their business. Strapped for resources and time, many choose not to navigate the bureaucracy and fees associated with the current UK immigration system. Instead, there are countless stories flying round business circles of outsourced technology work, excellent candidates passed over due to visa requirements, and business growth inhibited by talent shortages. A friend at a major multinational firm in London recently told me that her company "just decided not to support visas" in the UK because it "is too hard".
I firmly believe that the free flow of international labour and capital will help match skills with demand in the global economy and drive overall positive economic growth. I also think that it is critical for the world's best and brightest to acquire global capabilities and perspectives critical for modern businesses.
Countries that welcome global talent will benefit with faster economic growth and innovation. Immigrants, removed from the comforts of their home countries, are resourceful, ambitious and worldly. They build global businesses, like Google. They invest in local services, pay taxes and grow existing organisations. In the US, 40% of Fortune 500 companies were founded by immigrants or their children, now representing combined revenue of more than $1.7 trillion.
The world is in the midst of both a global talent war and global recession. Countries that welcome a flow of skilled workers and make it easy for businesses to attract them will win this war. In the process, they will become home to a melting-pot of ideas, innovation and global perspectives that will foster start-ups, grow multinational firms and drive overall economic welfare.
The UK must be at the forefront of this movement. Built on a history of international trade and finance, the UK has long been a magnet for world's best and brightest. But it now risks losing its reputation as an international business hub for many of the world's skilled workers.
Brynne Herbert (pictured) CEO and founder of relocation advice firm, Move guides