New proposals to limit UK migration could have serious impacts on salaries and the energy sector’s ability to recruit the talent it needs, according to employment experts.
It follows a string of changes unveiled by Home Secretary James Cleverly on Monday as the government attempts to reduce net migration by some 300,000 people per year.
Included are plans to hike minimum salary bands for skilled workers by nearly 50% – meaning that from spring 2024, a skilled worker from overseas will be required to earn £38,700 to qualify for a visa, up from £26,200 today.
The current shortage occupation list regime would also be scrapped, meaning employers will no longer be able to fill labour gaps by offering 20% below the going rate for jobs.
The minimum income required for a migrant seeking to bring a spouse or dependant to the UK on a family visa will also increase to £38,700, up from £18,600.
Graduate visa routes will also be examined to “prevent abuse”.
While the full implications of the announcement are yet to be determined, immigration experts pointed to the potential impacts salary thresholds in particular are likely to have on the energy sector.
Euan Smith, a partner at legal firm Eversheds Sutherland who specialises in immigration, told Energy Voice: “Government statistics suggest that just three of the top 10 most popular roles which, in the energy sector, are filled by recruits from overseas have an average salary which is more than the new limit.
“Therefore the increase in salary threshold is likely to place a lot of pressure on UK employers to increase the salaries paid to overseas skilled workers or to do more to try to find suitable candidates already in the UK.
“But with an array of engineering roles amongst the some of the most popular roles to be filled by skilled workers from overseas – especially in the energy sector – there will be challenges ahead for employers as they seek to prepare for changes when they arrive in spring next year.”
Another immigration legal expert, Burness Paull partner Jamie Kerr, suggested Scottish businesses would be hit “very hard” by the announcement of increased income requirements to hire from abroad.
“That will effectively close a number of sectors to international skills and labour. It also makes the UK a less attractive destination for investment,” he said, writing on LinkedIn.
This would have “a very real impact” on the labour market.
It follows FOI data requested by Eversheds Sutherland earlier this year which found a sharp increase in skilled visa applicants for energy-related fields, as the UK continues to draw on talent from across Europe and East Asia.
This marked a continuation of trends seen in 2022 when figures showed a post-Brexit increase in the number of entry permit submissions, particularly from South Asia.
However, further restrictions could have a serious impact on disciplines which Mr Smith previously suggested have an “obvious skills shortage”.
He had also called for the Migration Advisory Committee (MAC) to place more renewables roles on its list of shortage occupations to ease sector concerns – in addition to efforts to transfer and upskill the country’s existing talent base.
Earlier this year a key concession on visas for offshore wind workers also expired, meaning migrant crew members involved in offshore wind projects in UK territorial waters now require work permits.
Meanwhile, Pinsent Masons warned in March that the UK risks becoming “increasingly undesirable for skilled offshore workers and their employers” as a result of its immigration requirements.
Calls for fair pay offshore
Clean energy representatives said the sector would work with government to make sure any changes would not impact the roll out of new generation.
Emma Harrick, head of energy transition and supply chain at Scottish Renewables said: “The UK Government has previously recognised the importance of offshore wind as a central part of the UK’s future energy mix and has supported developers in attracting staff with the specific qualifications needed to work on the vessels building green energy projects along the UK coast.
“The renewable energy industry is committed to working with the UK Government to make sure the right people are in the right places to prevent the delay of offshore wind projects in Scotland.”
Union leaders instead suggested better industrial relations would be a better way to safeguard pay and jobs.
An RMT spokesperson said: “Fair pay agreements between trade unions, developers and contractors across the offshore energy supply chain would be the best way to protect and build sustainable domestic employment through the entirety of the supply chain within the industry.”
‘Polar opposite’ of north east needs
Political opponents were more forceful, with Westminster SNP leader Stephen Flynn, MP for Aberdeen South, describing the plans as “economic and cultural vandalism”.
He said both public sector institutions and private firms across the north east “badly need migrant workers”.
Meanwhile Russell Borthwick, chamber of Aberdeen and Grampian Chamber of Commerce, said the new rules would not help the north-east, which has an ageing population.
“This policy is the polar opposite of what the north-east of Scotland requires right now – we need more people to power our economy, not fewer,” he added.