UK being left behind in the tech talent race due to outdated visa system

By Asma Bashir, co-founder of Centuro Global

The contest to attract tech talent is fiercer than ever. Despite the recent economic slowdown and many businesses contending with the prospect of layoffs, the demand for tech professionals is rising.

UK tech jobs grew by 40% in 2022 and the sector is estimated to account for 7% of British jobs in 2023.? There are 2 million more people working in tech in 2022 than there were in 2019 and the UK is now home to the third most valuable tech economy in the world.

There are plenty of opportunities for growth ahead, but the UK is at risk of lagging behind the boom if it cannot attract quality talent to meet demand. British SMEs are struggling to hire at home and are increasingly looking abroad. A survey from Startups found that 53% of UK SMEs favour increased hiring from overseas.

The issue is compounded by an outdated, hard-to-navigate visa system that hinders bringing foreign talent to the UK. It is a system in need of urgent overhaul if the UK tech sector is to keep thriving.

Visas and Bureaucracy?

There are several hurdles that both in-demand employees and employers need to navigate before they can ensure they win the global race for talent. The UK immigration system is unclear and beset by delays. The bureaucracy and the hurdles can make the difference between UK organisations onboarding new talent and losing it to another country with better processes.? More than with most countries, companies must stay on top of the latest immigration developments to proactively leverage different visa options.

The UK has a way to go if we are to rival the compelling offers of other European countries.?

Spain has recently been attracting international talent with simplified new immigration rules. France has also updated and overhauled its previously difficult visa process with new tech licences and talent visas that enable work permits to sometimes be issued in days, rather than the weeks and often months. Digital Nomad Visas are being rolled out by more than 40 countries, affording employees the ability to work remotely for foreign companies while travelling.

The UK is yet to follow suit, with more restricted options available. For example, the 2022 introduction of the scale-Up Visa aimed to help startups attract new talent from overseas, tying employees to a sponsored scale-up company for only six months before leaving them with options for greater flexibility with their employment. Yet, with only four endorsing bodies currently picked by the Home Office to approve scale-up licences for companies to hire from abroad, the backlog of applications is running into the thousands.

Waiting times are spiralling and talent may be missed amid the chaos. While the Scale-up Visa is sound in principle, its tough enrolment criteria and manner of deployment risks is severely limiting its effectiveness.

Future Longevity

According to a survey by the Scaleup Institute , 83% of scale-ups currently rely on employing staff from outside the UK. If we are to continue on this trajectory and try to maintain the UK’s status as the top tech market in Europe, with 3 million new tech jobs predicted by 2025, there needs to be a radical overhaul of visa red tape and requirements.

We need to accept our dependence on talent from abroad and ensure that the process for attracting and retaining new hires is as smooth and efficient as possible.?

The scale-up visa has enormous potential to help companies attract necessary talent, and provides a path to settlement in the UK after five years for applicants.

It can only meet this potential if greater effort is put into easing its criteria and requirements to qualify, thereby encouraging more scale-ups to take advantage of the offer.

Looking ahead into 2024 and a long-awaited uptick in the UK’s economic prospects, the race for tech talent will only intensify.

If the UK government can ease the burden of the international hiring processes, our startups can lead the way in providing fast-track routes to creating international workforces filled with diverse and experienced talent.

This article first appeared in HR Magazine on 26 October 2023.