New visa salary thresholds coming into force in the UK have worried business leaders that a “hike in wages” could deter international graduates from settling in the country.
On April 4, the general salary threshold for the Skilled Worker Visa rose to £38,700, while on April 11, the family visa sponsorship threshold will rise to at least £29,000 a year – the first of three hikes in the figure planned for the next year, announced by home secretary James Cleverly in December 2023.
“New Entrants”, as they are called by the government, will still be eligible for a discount on the £38,700 figure.
These include international graduates applying for the Skilled Worker visa – most routinely after pursuing the Graduate Route for two years – but they will still need to earn at least £30,960 to be eligible, or 70% of the “going rate” for their occupation’s salary – whichever is higher, now confirmed by the government.
Thal Vasishta, managing director for corporate immigration at Paragon Law, expressed deep concern that international graduates applying for the visa may not gain the sponsorship they’re seeking under the new rules and gave an example of how this may play out.
“The going rate salary for most occupations have increased which has meant that in a large number of cases the new entrant salary will have to be more than £30,960 once the discount is applied,” he said.
He gave a “stark example” with the Standard Occupational Classification 2424 – business and financial project management professionals.
“[This has now been incorporated into SOC code 1139 and now has a going rate salary of £69,900 – once the New Entrant discount is applied the new entrant would need to be paid £48,930,” he explained.
“Previously, prior to April 4, the new entrant salary would have been £27,370!”
It’s not just concerns for international graduates, but the people employing them.
Business leaders are telling Adarsh Girijadevi, solicitor and head of immigration at City Legal Solicitors, that they’re concerned about the affordability of these new increases for Skilled Workers.
“[It] mandates employer to pay between £4 and £9 per hour more than the national minimum wage,” Girijadevi told The PIE.
“There is worry that the hike in wage requirements could deter young individuals in the UK from embarking on their careers, as the increased entry-level salaries might hinder their opportunity to gain essential experience,” he continued.
He noted that some employers may turn to internships or apprenticeships for these graduates as a “preliminary step” before offering permanent employment – initiatives that are “part of the strategies being employed to address the concerns of our clients”.
Any international graduates may also struggle to bring over their spouse from abroad, as the family visa threshold rises. Bell Ribeiro-Addy, MP for Streatham, pointed out how the rule would essentially mean only the highest 30% of earners can now bring their partner to join them in the UK.
“We need to roll back these cruel rules, which are tearing families apart,” she said.
In the UK, Glassdoor estimates that an international officer’s salary can vary from £29,000 a year to £37,000 – above the threshold that has come into force on April 11, but at its highest that it will reach in early 2025 – £38,700 – it won’t be enough.
Jobs.ac.uk estimates a starting salary in an international office can be around £18,000 – well below the threshold needed for the family visa, which can also vary by region.
Also varying by region – something the government has not taken into account, said Vasishta – is the Skilled Worker going rate per occupation.
“We are becoming increasingly uncompetitive in attracting the brightest and the best”
“A number of our clients in sectors such as manufacturing, services and IT in the Midlands and north have said that the new salary increases will mean that recruiting international people, including students will not any longer be an option for them,” he warned.
One employer did suggest putting up the salaries to match resident workers, which could create higher wage inflation and potentially more problems nationally, he continued.
“This policy will in my view need to be reconsidered by whichever government is in power by the end of this year as they begin to see that vacancies are still high.
“We are becoming increasingly uncompetitive in attracting the brightest and the best to the UK because of more welcoming work immigration rules in other countries,” Vasishta added.
“It is crucial that policymakers monitor the consequences of these changes and intervene if necessary to avoid adverse effects on the job market,” agreed Girijadevi.
