As Brexit moves into its final stages and the government sets out its proposals for a new immigration system, it is important that the government continues to listen to the needs of employers – particularly in the engineering sector, argues Alexander Jan, chief economist at Arup
In the week before Christmas, the government finally published its White Paper on immigration. The policy proposals will come into force over a transition period, when – or perhaps increasingly if – we disengage from the current arrangements in place with our fellow EU and EFTA countries.
Proposals include a 12 month visa for so called low skilled workers with “restricted entitlements and rights.” It was going to be eleven months. That would have meant visa holders would not have shown up in headline immigration statistics. There is also the prospect of a minimum salary requirement of £30,000 for skilled (or so-called ‘Tier 2’) visa applicants coming from the rest of Europe. This would bring EU/EEA applicants “into line” with individuals from the rest of the world seeking higher paid employment. Notwithstanding the loosening of quotas, the White Paper signals the most significant tightening of British immigration policy since the Commonwealth Immigration Act of 1962.
Immigration is politically fraught. On the one hand the government is keen to show it is responding to public concerns. Immigration shows up in polls as to why some people voted for Brexit. On the other, non-UK labour has proven invaluable in sustaining the British economy. Many sectors – from care workers to corporate finance – have a significant degree of dependence on the two million plus EEA nationals – plus millions of other overseas individuals – who have made Britain their home. Without them, vital public services such as health and social care and the City would suffer.
The infrastructure, construction and engineering sectors are no exceptions. According to the Royal Academy of Engineering, we need nearly 200,000 new engineers and engineering technicians a year until 2022. It would be impossible for the UK to fill all of these positions with home grown talent alone. And as the academy points out, engineering is a sector which often needs large numbers of skills to help deliver a particular phase of a project. Arup – and our clients – rely on the ability to move staff between countries as a new railway, tall building or power station evolves from the drawing board to delivery. For Arup, international mobility is key to fostering a unique culture in our staff owned business. This in turn helps us deliver better solutions for clients by retaining the best talent. Barriers to movement risk creating delay and cost increases to projects and damaging the competitiveness of UK engineering; a sector that is not only important to the domestic economy – but is also key to Britain’s export success.
If we are going to reform the present immigration model, a number of objectives for policy should be centre stage. As a recent report from business campaigning group London First highlights, these should include providing business with access to people and talent at all levels. “Low pay” does not equate with “low skilled”. And whilst we should look to further investment in training and education for UK citizens, the sheer scale of the country’s requirements for lower and higher paid jobs mean it will be essential to allow access to overseas labour in the years ahead. London First’s report suggests a ‘Tier 2’ salary threshold of £20,155 (the London living wage). The White Paper has put a threshold of £30,000 out to consultation. London First also advocate no artificial caps on visas. The government appears to have listened to that request. And any revised system will need to be based on much better data. That would help to build trust with the public and allow for a more informed debate about policy in the future.
Brexit – in whatever form it takes – is just months away. For the wellbeing of the UK’s economy and the engineering sector, it is imperative that the government comes forward with an immigration policy that supports long term growth and competitiveness. It should explicitly acknowledge that creating opportunities for all those who wish to work or contribute to such an important part of Britain’s industrial base is a good thing and then back this up with sensible policy proposals. As the White Paper goes to consultation, it is imperative businesses respond and have their voices heard. And that includes the engineering community. Whatever the outcome of March 29th, an evidence-based, progressive immigration policy that allows all sectors of the economy to prosper and grow is urgently needed.