Potential Impact Of White Paper – Exposure Of United Kingdom Jobs To Global Competition


Employment, Migration Trends, Policy, Visas/Work Permits

  1. The Immigration White Paper proposed both removing the Tier 2 work permit cap and diluting the skills threshold for Tier 2 visas from graduate level to A-level. The latter change would mean that jobs such as IT support worker, marketing assistant and housing officer would come under Tier 2
  2. Depending on the salary threshold finally agreed, between six million and up to nine million full-time jobs held by UK-born employees would be exposed to new or increased global competition. This is based on analysis of the Labour Force Survey (Q2 2018) – see figure 1 below.

Salary threshold set at £30,000 – Up to six million jobs exposed

  1. The Migration Advisory Committee recommended retaining the Tier 2 salary level at £30,000 (since this is the level of household income at which an average family of EEA migrants starts making a positive contribution to public finances). In such a scenario around six million jobs would be exposed to new or increased competition from around the world.
  2. As Figure 1 below illustrates, the six million figure comprises:
  • A) Four million highly-skilled jobs earning £30,000 or more per annum. These are already open to non-EU nationals who meet the criteria but constrained by the Tier 2 cap, as well as to UK / EU nationals, and certain non-EU nationals who are here on other visas (e.g. spousal visas, refugees, dependants).
  • B) Two million medium-skilled jobs earning £30,000 or more per annum. These are currently open only to UK / EU nationals and certain non-EU nationals here on other visas (e.g. spousal visas, refugees, dependants).

Salary threshold set at £21,000 – Up to nine million jobs exposed

  1. Under pressure from employers, the government may also lower the salary threshold to £21,000 (it is currently £21,000 only for new labour market entrants but £30,000 for experienced workers). This is a very low hurdle. It is just over the current “Living Wage” for London (currently £9.50 per hour, or £19,000 per year). In such a scenario, up to nine million full-time jobs held by UK-born workers would be exposed to new or increased competition from around the world.
  2. As Figure 1 below illustrates, the nine million figure comprises 4 (A) and (B) plus:
  • Three million highly and medium-skilled jobs earning between £21,000-£30,000 per year. About 1.4 million of these jobs are highly skilled and are only open to UK workers and to new labour market entrants from outside the EU but the latter are constrained by the Tier 2 cap. About 1.6 million of these medium skilled jobs are currently only open to UK / EU nationals and certain non-EU nationals who are here on other visas (spousal visas, refugees, dependants).

Figure 1: UK full-time employees by skill[1]/salary, LFS, Quarter 2, 2018.

[1] Determined by major occupational group level.

11th February 2019

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