How is the Migration Cap affecting your Business?

January 4, 2012

We’d like to welcome our readers back to our first blog of the year!  We hope that you all enjoyed the festive season and are having a great start to 2012.

Last year saw great upheavals as the Government made drastic changes to the United Kingdom’s Immigration Rules and Regulations.  These changes were designed to reduce the numbers of non-European Union migrants entering the UK to work, study or live.  Employers ranging from large multi-national corporations to smaller, medium sized businesses have been hit by the cap which prevents them from sponsoring skilled non-EU workers unless they meet certain strict criteria, and imposes limits on the numbers of such migrants they may hire.     

In light of the challenges which companies have faced in recruiting new hires from overseas, we thought it would be apt to reflect on how far the immigration developments of 2011 have affected employers, and look ahead to the coming year. 

The Migration Advisory Committee (MAC) called for evidence as to how the migration cap is currently operating, and the findings collected by the Chartered Institute of Personnel and Development (CIPD) make for an interesting read.

CIPD report that due to “the ongoing economic crisis and the resultant stagnation in the labour market…only a tiny proportion of UK employers now say that the migration cap is having or will have a damaging impact on their organisation in the short to medium term.”  This shows that perhaps the effects of the cap are not as damaging and detrimental to UK businesses as it was anticipated they would be.  However, it is because of the current economic situation that companies are reluctant to take on any new hires, regardless of whether they are from the UK or overseas.  Given the fact that the UK’s labour market is so crippled by the effects of the recession and economic downturn, it seems highly reasonable that employers would not be filling their quota of Tier 2 non-EU migrant workers which they are allowed to hire each year, accordingly this quota should not be reduced further. 

The report also states that “the Government will need to be ready to respond flexibly as the economy recovers if the UK wants to remain equipped with the skills and business environment required to compete internationally.”  We hope that the UK’s economy will continue to recover in 2012, although clearly growth has been very little thus far and it is uncertain how exactly things will unfold.  However, we agree with CIPD that it is important for the Government to avoid harming businesses further by imposing more limits on the numbers of highly skilled workers they can employ.  As companies recover from the recession and look to expand, they should be able to do so without facing further onerous immigration restrictions.  Changing the current Tier 2 Visa quotas could hinder our economy’s growth and keep out those are vital to its recovery.

The UK should remain a place which welcomes skilled, entrepreneurial individuals rather than scares them away.  We hope that the Government will not forget this as we move into 2012.  It is all too easy to clamp down on non-EU migrants entering the UK as being an easy fix to a problem which raises strong passions in the public and press.  But the Government should be aware that cutting down on those who are highly skilled, and can genuinely add value to our society, will only cause further harm in the long run.

Let us know how the migration cap has been affecting your business, and how you hope to see the Government manage UK Immigration in 2012!