Will Tier 2 visa cap reforms help to solve the UK skills gap?

It goes without saying that the Government’s decision to remove certain medical practitioners and nurses from its Tier 2 visa cap was warmly welcomed by the UK healthcare sector. However, as well as allowing job shortages to be addressed and patient service levels to be maintained, the increased availability of certificates will also significantly benefit other sectors of the UK economy.

As well as making it more straightforward for the healthcare sector to fill vacancies within its organisations, the changes may provide a much-needed boost to businesses in other sectors, making the process of recruiting from outside the EU much less competitive.

Currently, businesses looking to recruit skilled non-EU workers must navigate the UK’s points-based immigration system. In addition to being a sponsor licence holder after UK Home Office approval, employers must also apply for a Restricted Certificate of Sponsorship when recruiting from outside of the UK. Since 2011, an annual cap of 20,700 has been in place for these, divided into monthly allocations. Eligibility for a Tier 2 visa is based on employers accruing a minimum amount of points. To get certificate approval, employers must meet a Resident Labour Market Test, offer an appropriate minimum salary level for the job and score a number of points depending on the monthly allocation to ensure their application is prioritised to meet the quota.

The recent changes to the Tier 2 visa cap will free up hundreds of certificates of sponsorship for highly-skilled workers in a variety of sectors, including engineering, teaching and IT. However, for employers looking to recruit talent from outside the EU, the current process is still far from straightforward.

In addition to complying with strict advertising requirements when sponsoring non-EU nationals, SMEs in particular are likely to be put off by the need to pay high Government processing fees including skills charges and mandatory health charges. In recent months, there has been a significant peak in the number of employers applying for Restricted Certificates. As such, for a large proportion of businesses carrying out the Resident Market Labour Test, where jobs are not in shortage occupations or specific PhD jobs, only jobs with highly paid salaries are achieving the requisite number of points and being awarded the certificates. In a five-month period from December 2017 to April 2018, 8,000 out of nearly 17,000 requests for Restricted Certificates of Sponsorship were refused.

As well as the significant financial burden this may cause employers, it often means that lower-paid roles – which still have respectable salaries – are being excluded from the Tier 2 scheme. Ultimately, this could end up increasing the skills gap for certain positions.

While the UK currently remains an attractive option for overseas talent, more needs to be done to streamline the recruitment process for employers and take into account the growth of new and developing UK sectors, for example, IT and FinTech. The UK Government could consider, for example, emulating flexible points-based immigration systems such as Australia’s, where points requirements are adjusted according to demand for workers in different sectors. While the Government has requested that the Migration Advisory Committee reviews the shortage occupation list to demonstrate more clearly where labour shortages exist, this will need to be updated regularly in order to accurately reflect the situation in fast-moving sectors.

With the UK’s skills gap regularly hitting the headlines, this latest reform to the Government’s Tier 2 visa scheme is certainly a positive step, helping more businesses to recruit skilled workers from outside the EU. However, by further streamlining the recruitment process for employers and taking inspiration from overseas immigration systems, the Government can ensure a steady stream of talent from overseas and ultimately provide a much-needed boost to the UK economy.

Tijen Ahmet is a legal director and business immigration specialist at law firm, Shakespeare Martineau.

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