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UK tech is outraged about Rudd's immigration crackdown

Lynsey Barber
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The Silicon Roundabout In Old Street
Enterpreneurs, VCs and experts in UK tech are not happy with Brexit immigration plans (Source: Getty)

The UK's reputation as one of the leading digital economies in the world and a global tech hub could be at risk from fresh government plans to crackdown on foreign workers.

The new home secretary Amber Rudd yesterday revealed plans to reduce immigration, including proposals to "tighten" the test for companies recruiting from abroad to encourage hiring of UK workers.

"Rudd's proposed crackdown on work visas could have a hugely damaging impact on the UK and its position as one of the world's leading digital economies," said co-founder of early stage tech investment firm Seedcamp, Reshma Sohoni​.

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"Founders constantly talk to and influence each other and plan carefully where to set up. These crackdown ideas will not only drive the best minds away from setting up in London but it will drive most of us who are here away also."

One UK venture capital investor branded another plan to force employers to list the number of foreign workers they employ as "shameful and moronic".

"Because badges for public shaming worked so well last time. Shameful and moronic. Diversity is UK's biggest asset (says immigrant)," tweeted Christian Hernandez of White Star Capital.

Startup founder Taavet Hinrikus tweeted: "Half of our London team is from outside the UK @AmberRudd_MP; immigration = growth."

The company he founded, Transferwise, is one of the UK's rare "unicorn" startups valued at more than $1bn (£786m).

Estimates put the proportion of EU nationals working in the UK's tech sector at around a third and hiring of foreign workers - something that is already an issue for the industry due to a complicated visa process - comes largely as the result of an ongoing homegrown skills shortage.

"More than one in five UK tech startup founders are immigrants and have built high-skilled global teams. We should be proud of their enormous contribution to the UK - helping create over 1.46m new jobs and a fast-growth digital economy that contributes over 10 per cent of our GDP," said Romilly Dennys, executive director of tech policy group Coadec.

"The government needs to make it easier, not harder to attract high-skilled talent, together with a national skills agenda to support domestic talent. The two need to go hand in hand to ensure we compete on a global scale, otherwise we face the very real risk of dragging the country backwards, not forwards," she added.

The announcement comes as Prime Minister Theresa May hit the accelerator on Brexit with a series of long-awaited commitments on matters such as immigration and the Single Market at the Conservative Party Conference.

But while greater certainty has been welcomed, businesses are concerned that the exact terms proposed signal a so-called hard-Brexit which would limit access to the Single Market which is seen as essential by most.

And now, the UK's burgeoning tech scene has echoed the concerns of the wider business community on the immigration proposals.

“This reactionary call to restrict access to global talent goes against everything we are doing to build a global tech hub that rivals Silicon Valley. One out of every three UK tech employees was born overseas, and their hard work and commitment has played an essential role in making London the capital of European tech," said Russ Shaw of Tech London Advocates.

“Calling on firms to list their non-UK employees is an unwelcome and unnecessary piece of red tape that stigmatises some of our brightest entrepreneurs. Tech London Advocates has celebrated the international workers building our startups and scaleups, and we will continue to make our voice heard and fight hard to ensure that London remains open for business," he added.

Those in the UK tech sector had raised eyebrows over May's approach to immigration after she became PM.

"Some of what she's said about immigration is concerning. The tech community is full of wonderfully smart people. Hopefully she has a more nuanced approach than she's been quoted as having said before and an understanding the debate in greater detail," said entrepreneur and investor Brent Hoberman, speaking to City A.M. at the time.

City AM Will this proposed immigration crackdown torpedo the UK tech sector?

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