Home Business News Raising the threshold for visas will strangle our economic growth

Raising the threshold for visas will strangle our economic growth

1st May 24 9:18 am

The Government is making a mistake in raising the threshold for skilled worker employment visa sponsorship, hurting small businesses who need less barriers to growth, now more than ever.

Fears about uncontrolled illegal immigration are warranted, and the Prime Minister is right to want to crack down on those who profit off the aspirations of desperate migrants as well as those who seek to cut the queue ahead of lawfully abiding citizens waiting for visas at embassies.

But making it more difficult for small businesses to hire foreign talent is not the way to go about this.

We want citizens to start their own businesses – indeed, this is the lifeblood of a vibrant, innovative and competitive economy. The British entrepreneurial spirit will deliver great ideas, resolve emerging challenges, and deliver better outcomes for workers and consumers.

Incredibly, 99% of the businesses in the UK are SMEs, and these businesses account for over three-fifths of employment in the UK is from SMEs – an often-unappreciated figure which our government should take note of. The importance of this sector is self-evident, and we should be doing everything we can to support the smallest businesses and employers who keep our economy moving.

For small businesses, raising the threshold for employment visas will make this unaffordable for many small business owners. This will directly harm their ability to hire new talent and stack the deck against those who bring so much dynamism and innovation to our economy.

Imposing more barriers to growth on such an important part our economy will have a impact felt far and wide. When businesses find it tougher to hire the staff they need, we can’t be surprised if the UK economy becomes less competitive compared to similar nations like Ireland or Canada, other English-speaking nations which will be more than happy to suck up foreign direct investment and human capital leaving the UK.

The UK economy can indeed be an enabler of growth and opportunity for everyone, especially if we focus on unlocking the potential of our smallest employers, who often work at the local level and will be a prime lever for the Levelling Up agenda. But to do this, we need to make it easier to start and grow a business here, not more difficult.

The increase in salary requirement for skilled visa is a great case for this. With fears about overpopulation and protectionist interests having major sway in the Conservative Party, we’ve sublimated a push for growth in favour of interests which are misguided. Now, foreign workers have to earn at least £38,700 – an increase of nearly 50% from the previous £26,200 minimum – to qualify for a skilled worker visa.

The Prime Minister has justified this as a means of cutting immigration figures when we should instead focus on tackling illegal migration, rather than punishing those who are looking to contribute to our economy and the businesses that we need to grow in order to provide a better standard of living for our citizens.

That’s not to say that immigration isn’t a legitimate concern – indeed, populist sentiments in Western nations only increase when these kinds of concerns are ignored by the political establishment. But this doesn’t mean that we give in to these concerns without thinking critically about what kind of country we want to be, and the policies we implement to make that vision a reality.

Instead, the Government should roll back this change and lower the barriers to growth while concentrating on policies which will concretely reduce illegal immigration. This would both be a more fair and just immigration policy and would enable the economic growth we so desperately need.

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