Reshaping the working landscape of the UK - Joanne Hennessy

During the general election, there was a broad political consensus that net migration figures were too high, and Labour has always been clear that reshaping the UK’s immigration landscape would be part of its plans to tackle the issue. Earlier this month, Home Secretary Yvette Cooper set out the first steps of her review into legal migration to the UK, which will have a number of implications for Scottish businesses. In a ministerial statement, the Home Secretary confirmed four key takeaways:

• The government will be tackling skills shortages in the UK as a means of reducing reliance on hiring from overseas. This will see the government introducing initiatives aimed at upskilling local labour through training programmes, as well as targeted labour market policies.
• Inevitably, some sectors are more reliant on international workers than others. Construction and engineering, the care sector and IT/digital (to name a few) often rely on filling labour shortages by recruiting from overseas. These industries can expect to be placed in the spotlight during the government’s review.
• At the moment, the previous government’s five-point plan is to remain in place, including the significant salary increases imposed on those seeking skilled worker visas. The only exception to that is there has been a pause on the further salary requirement increases due to come into force for those seeking partner visas, pending further review.
• Further powers will be awarded to the Migration Advisory Committee (MAC), an independent non-governmental public body that advises the government on migration issues – including having a greater role in informing policy.

Exemplifying those powers, on 7 August the Home Secretary tasked the MAC to conduct a review of IT, telecommunications and engineering roles to understand why these industries rely on international recruitment to fill positions. As part of the review, the MAC has been asked to consider: which roles are in shortage; the drivers of those shortages (including training, pay and working conditions); how sectors have sought to respond and adapt to shortages (other than recruiting from overseas); any impact the previous shortage occupation list had for those roles; and the policy levers within the immigration system, which could be used to incentivise employers to focus on recruiting from the domestic workforce.

We can expect to see similar reviews take place across other sectors recruiting heavily from abroad, such as the care sector. It remains to be seen whether the hospitality sector, which is often overlooked, will be reviewed to consider whether the UK’s immigration policies could be used to support it in the face of ongoing recruitment challenges.

Unlike the previous government, the MAC has been invited by Labour to consider a range of options, including the pros and cons of taking a differentiated approach to migration based on region, role or other factors. It’s possible that taking a more flexible and open approach to immigration – although it could cause challenges in terms of how to police differing rules – could have a long term positive impact on businesses and their individual requirements.

In the meantime, it’s clear employers and sectors will be expected to tackle skills shortages from the grassroots up. Until all issues are resolved, businesses meeting eligibility criteria may continue to consider international recruitment.

Joanne Hennessy is Partner and head of business immigration, TLT