UK work permit cap 'challenging businesses'

06 Dec 2010 | Posted by Carl Thomas

The UK work permit cap is presenting a challenge to businesses in the UK, a recent survey by accountancy firm PwC has revealed.

While 28 per cent of companies in the UK are planning to increase their headcount and hire more staff in 2011, 53 per cent of respondents claimed that skills shortages are the biggest challenge to them doing so.

The recent limits on UK work permits are unlikely to assist these employers, as home secretary Theresa May has confirmed that Tier 2 work permits and Tier 1 highly skilled visas will be capped at 21,700 from April next year.

Michael Rendell, head of HR services at PwC, commented on the situation: "Ensuring staff can be easily deployed internationally is ever more important for businesses extending their global reach, but UK firms have been particularly challenged by the immigration cap."

He added that the move to restrict people earning between £24,000 and £40,000 to one year stays "does not make economic sense" and noted that bringing people in to the UK for less than two years "poses a serious threat to the flexibility of the UK's labour market".

The PwC research confirmed that the number of British businesses expecting to create new jobs has more than doubled since last year's survey, when just 13 per cent of firms were planning on making increases.