The UK technology sector is booming. Investment in UK tech firms is at record-breaking levels. And yet for many years, businesses have reported a widening skills gap and a struggle to fill key vacancies. With Brexit day finally here, what changes to the immigration system can the tech sector expect to see over the coming months?

One of the government’s ‘guarantees’ during the election campaign was to introduce an “Australian-style points-based system to control immigration”. The Home Office has just announced a new Global Talent visa and we’ve also seen new recommendations from the Migration Advisory Committee (MAC), a team of economic experts advising government on immigration policy.

But for now, there won’t be any change for European workers in the UK and for British workers in the EU until 31 December 2020. Free movement continues during the transition period, so European Economic Area (EEA) and Swiss citizens can continue to relocate to the UK until 31 December 2020 without needing a visa. It’s optional for Irish citizens, but EEA and Swiss citizens living in the UK by the end of 2020 must apply to the EU Settlement Scheme by 30 June 2021. Approval will give either temporary pre-settled status, or settled (permanent residency) status, to preserve their right to live, work and study in the UK.

The post-brexit immigration system in 2021

From January 2021, a new (TBC) immigration system will apply equally to EEA and non-EEA citizens moving to the UK. Europeans moving to the UK from that date can’t use the EU Settlement Scheme. Businesses wanting to hire European workers from outside the UK should expect longer lead-in times and request an increase to recruitment budgets to take account of extra visa costs.

Work visas may not be available for lower-skilled roles, or if they are, they may not permit long-term stay. Organisations will also have to change the way that they check the immigration status of new UK based hires, but not until the new system goes live.

Global Talent visa

The UK government has just announced a new Global Talent visa. When we say ‘new’, what we mean is that the existing Tier 1 Exceptional Talent scheme has been rebranded as ‘Global Talent’, but with some minor changes. When it opens on 20 February 2020, it will be expanded to cover leading scientists and researchers, but will continue largely unchanged for applicants in several other sectors, including digital technology.

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Anyone already on the Tier 1 Exceptional Talent visa can extend through the Global Talent scheme. The Global Talent route continues to be a personal visa, not tied to employment with one business. No job offer is needed. It requires prior endorsement by Tech Nation, either as an applicant of exceptional talent (for leaders in their field) or exceptional promise for those with the potential to become leaders. Both lead to permanent residency but digital technology applicants meeting the exceptional talent standard can qualify two years faster.

Problems with a points-based system

The scheme for tech applicants will remain open to founders, executives and to employees with technical backgrounds, and across all sub-sectors like fintech, AI, cyber, and gaming. It’s a great visa for those awarded approval, but as the MAC highlighted in its January 2021 report ‘A Points-Based System and Salary Thresholds for Immigration’, this visa category does not work well.

The MAC reported what we already know – that the high skills bar makes it too hard to qualify, as evidenced by the fact that only 600 people got the visa (across all sectors, not just tech) in the last full year of records, against a cap of 2,000. So announcing that the cap will be removed on 20 February has no practical impact, as the quota has never been hit anyway.

The MAC recommended that any points-based system be based on the current Tier 1 exceptional talent route, which already exists for migrants looking to move to the UK before securing a job. But rather than targeting established exceptional talent, it should look at those with high potential too. The MAC proposed opening up the scheme by using a tradeable points scoring system, with points for different characteristics, but with a weighting for some applicants like those with STEM qualifications or other desirable skills. Candidates that expressed interest in the scheme would then be drawn monthly from a pool and invited to apply.

There is a need for a wide variety of talent, not simply those deemed to be ‘exceptional’. By focusing on only the paper-thin layer at the top, the system shuts out a pool of talent that could easily contribute to the UK’s technological success.

Tier 2 visas

The MAC rejected plans to move to a completely PBS system based loosely on the Australian model, preferring instead to retain the certainty and control of the current Tier 2 General route, coupled with an amended Global Talent visa. Tier 2 is the main work route for those with a job offer, and results in a work visa tied to skilled employment with one employer.

There has been considerable debate about whether the minimum salary level in the new scheme should replicate the current £30,000 threshold. The MAC thought not. Using a technical calculation, it suggested a minimum of £25,600, and around £18,000 for graduates and younger workers.

If the Home Office keeps the Tier 2 framework and also sticks to commitments in an immigration white paper published at end of 2018, from 2021 there may also be some relaxation of the red tape for Tier 2 employers. Previous proposals included lowering the required skill level, removing the cap and scrapping the need to advertise roles before sponsoring. This would be a gesture towards bridging the skills gap and the higher post-Brexit demand for workers that won’t be addressed by the Global Talent visa if it continues to focus narrowly on the rarest talent.

Some hope remains for post-Brexit immigration

Whatever happens, at least for the rest of 2020 technology employers can make use of the radical expansion of the Shortage Occupation List (SOL) in October 2019. Tier 2 sponsors are exempt from the advertising process – and the resulting extra delay and compliance risk – for SOL roles. They also get a slight reduction on visa fees, on minimum salary level for permanent residency and priority assessment whenever the Tier 2 cap is hit.

As part of the changes in October 2019, the onerous requirement for businesses to apply for ‘digitech’ registration was dropped and many more technology roles were added to the list. The SOL now includes all programmers, software developers, IT business analysts, architects, systems designers and web designers, among others.  And the addition of cybersecurity specialists was also a real boost for UK businesses in that industry, worth an estimated £8 billion. In the last few months, we’ve seen these changes make a tangible positive difference to tech employers.

For now, we need to wait for the government’s response to the MAC report in the next few weeks. Initial soundings suggest that it may proceed down a different path, but whatever the outcome, businesses and workers need to know the direction of travel quickly to be able to plan future recruitment and international assignment projects.

Read more: With record investment in UK tech in 2019, what impact will Brexit have?