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Budget visa concessions - is it the panacea suggested?

21 March 2023

The recent budget outlined plans to relax immigration rules in a bid to tackle the chronic skills shortages in the construction industry.  

As interested readers will be aware, following Brexit, there has been a significant and increasing labour shortage in the construction sector.  Vacancies have risen strongly and comparison of the three-month period (November-January 2023) with the pre-pandemic period (January-March 2020) shows vacancies are now 65% higher. 

Consequentially, Chancellor Jeremy Hunt has used the recent budget to provide confirmation that, "in order to ease immediate labour supply pressures" the government will accept the interim recommendation of the Migration Advisory Committee’s (MAC) Construction and Hospitality Shortage Review to add five construction industry occupations to the Shortage Occupation List.  These are bricklayers and masons; roofers, roof tilers and slaters; carpenters and joiners; construction and building trades; and dryliners and plasterers. 

In essence, this means that registered Home Office sponsor licence holders in the construction sector will be able to recruit non UK or settled workers under the Skilled Worker Visa route to these five occupations, at a discounted salary of 80% of market rate (subject to a present minimum of £20,480 per annum / £10.10 per hour), as well as incurring marginally lower visa fees.

Given that the construction sector accounts for 6% of all UK workforce jobs, on first glance this would appear to give a well needed boost to recruitment.  However, 30% of jobs in the sector are undertaken in a self-employed capacity, which is not eligible for the Skilled Worker Visa route.  Furthermore, MAC statistics show that construction jobs only made up 1% of Skilled Worker Visa applications in 2021, which highlights the fact that many SME construction firms are not routinely registered as Home Office sponsors - Possibly by reason of Sponsor Licence application and administrative costs and also dealing with Home Office bureaucracy.    

Although more conclusive findings are to be published later in the year, MAC's overall view appears to be that sector wide initiatives to improve recruitment and retention, in conjunction with long established training routes, will go a long way to resolving sector shortages domestically in any event.  In addition, MAC points out that there are already several existing other visa routes that allow for migrants to come to the UK to work in the sector.  Not only can international university students work during their courses, and for two/three years afterwards, but there is also the Youth Mobility Visa (YMV) where young people from designated countries can come to the UK for two years and work in any sector, without the requirement for business sponsorship.  Whilst MAC has made the above recommendations for the Skilled Worker Visa, as now to be adopted by the government, its long term solution seems to be to continue to develop "home grown talent", supported by an increase in the number of visas under the YMV scheme.    

To find out more about the points raised in this article, please contact John Dorney.

Further Reading