Skills shortage: is international hiring right for your firm?

The UK construction industry is facing a significant challenge with a growing skills shortage that threatens to delay projects and increase costs.

As the demand for skilled labour continues to outpace supply, many companies are looking to bring in qualified workers from abroad to help keep the industry moving forward.

However, companies must take a number of considerations into account to ensure success and compliance with complex immigration rules.

In April 2024, the government implemented restrictive changes that impact how and who employers can sponsor from overseas. 

The minimum base salary for the skilled worker visa category was increased to £38,700 or the “going rate” for the role (whichever is higher), subject to certain exceptions.

For example, based on a 37.5-hour working week, the following salary thresholds may apply for roles in the construction sector:

The Shortage Occupation List, which provided a discounted salary threshold for certain roles, was abolished and replaced by a reduced Immigration Salary List.

A lower threshold applies for sponsorship of overseas workers for roles on the Immigration Salary List. Examples include bricklayers, roofers, carpenters and retrofitters.

Sponsoring workers in these roles may benefit from a reduced salary threshold of £30,960, based on a 37.5-hour working week (equivalent to £15.88 per hour).

Whilst these changes have reduced the ability of construction firms to sponsor overseas workers, options may still be available.

One common misconception is that workers must hold a degree, or have similar experience, for the role to be sponsorable.

Sponsorship of a lower skilled role may be possible if it is deemed as requiring skills at level 3, or above, of the Regulated Qualifications Framework. This is equivalent to A-level, vocational level 3, technical level 3.

Sponsors should retain evidence that the worker has the skills and experience to do the job. Examples could include academic certificates, references from a previous employer or other evidence of work experience.

The list of roles which can be sponsored can be found here.

Workers sponsored under the skilled worker route will need to demonstrate English language ability to at least level B1 on the Common European Framework of Reference for Languages (CEFR) scale.

This means that they must be able to converse on matters regularly encountered in a work setting, as well as being able to read and write on topics with which they are familiar.

The workers can typically meet this requirement by taking a test, or through other options detailed here. 

Those under 26, or holding a student/graduate visa, can be classified as “new entrants”.

This means that they need to meet the higher of £30,960 or 70% of the going rate.

For contract/project managers, this may reduce the salary threshold to £30,960, based on a 37.5-hour working week.

Overseas workers who received their first certificate of sponsorship before 4 April 2024, and have continuously held a skilled worker visa since, benefit from transitional provisions.

A reduced rate, of between £23,200 and £25,600 based on a 37.5-hour working week, may apply for bricklayers, roofers, carpenters and retrofitters.

Other visa routes are very limited, unless the worker has a British partner or has ancestral links to the UK via a British grandparent.

Recent UK graduates may apply for a two-year visa that permits them to work in the UK. This is non-extendable and so, beyond the two years, sponsorship is likely to be required for them to continue to work in most instances.

Youth mobility schemes exist for certain nationalities, which allow workers aged 18 to 35 from select countries to apply for a visa for two to three years. Details on eligible nationalities, age and duration can be found here.

It’s important to note that this option is not extendable and there is currently no scheme for European nationals.

The UK government has pledged to create a more cohesive labour market strategy by integrating immigration policies with skills development initiatives.

One of the first steps in this direction is the commissioning of the Migration Advisory Committee to review skills shortages in the IT and engineering sectors.

Further reviews are anticipated in 2025, and it is possible that projects linked to the sectors targeted by the UK’s industrial strategy may benefit from changes to immigration policy, such as those in advanced manufacturing, clean energy or defence.

It is possible that youth mobility schemes will be extended to more countries as part of future trade negotiations.

The EU has proposed a reciprocal youth mobility scheme that would allow European nationals to work in the UK for a limited period, which has been rejected so far by the UK government.

To meet the target of building 1.5 million more new homes over the next five years amid ongoing labour shortages, the government must look to revise its immigration policies.

Sean Rhodes is a manager at Fragomen.