UK start-ups have called on the government to reconsider its visa immigration rules in order to attract high-skilled workers for the tech industry.

In an open letter addressed to the home secretary, think tank Entrepreneurs Network and lobby group the Startup Coalition warned that the decision to raise the minimum salary requirements for its Skilled Worker Visa means that many early-stage tech start-ups won’t be able to hire foreign workers.

In December last year, the government increased the earnings threshold for the visa from £26,200 to £38,700.

The letter said that many early-stage start-ups cannot afford to pay workers high wages at the outset, instead they may offer alternative compensation such as equity stakes in the company as part of their compensation packages, giving them a portion of ownership in the company.

But the organisations suggested that the government’s new salary requirements will mean that many start-ups who compensate their employees in this way will be unable to employ foreign workers using the Skilled Worker Visa.

They called on the government to allow equity to count towards the salary requirement making it easier for start-ups to attract talent.

“[Start-ups] often compete with larger, more established companies for talent too – yet these changes could see dynamic start-ups miss out on the skills they need, while established tech giants will be unencumbered by them,” it continued. “Start-ups based outside of London, where data shows tech salaries are lower, will be disproportionately impacted by these changes.”

In a study published last year, The Entrepreneurs Network found that 39 per cent of the UK’s fastest-growing start-ups have at least one immigrant co-founder, which fell from 49 per cent in 2019.

National Technology News has reached out to the UK Home Office for comment.

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