Hundreds reject tech jobs after Brexit vote

Please see article in the Financial Times:

Start-ups say Britain’s reputation as a centre for innovation is being damaged

Hundreds of people have rejected technology jobs in Britain since the UK voted to leave the EU, according to a survey of entrepreneurs who say an intensifying skills shortage has already damaged the country’s reputation as a centre for innovation.

More than a third of entrepreneurs have lost a prospective hire because of uncertainty about immigration following the EU referendum, according to a survey of 5,400 founders carried out by Tech London Advocates, an industry body.

The extensive survey comes just one day after Downing Street announced plans to double the number of “tier 1” work visas granted for “exceptional talent” to 2,000 a year, in an effort to reassure anxious technology companies about their ability to hire after Brexit.

London risks losing out to European start-up rivals

In a meeting on Wednesday, Theresa May, prime minister, and Philip Hammond, chancellor, spoke to tech executives, including Herman Narula, co-founder of Improbable, Ali Parsa, founder of Babylon, and Aldo Monteforte, chief executive of The Floow, to discuss the industry’s concerns.

The group discussed immigration, venture capital investment and a batch of government initiatives, including a £20m fund for public services to invest in artificial intelligence.

“The economy fit for the future which we will build as we leave the European Union, and forge a new role for ourselves in the world, must be one which leads the world in innovation and emerging technologies,” Mrs May said at the meeting. “We have all the ingredients of success: immense human talent, world-leading universities, and a thriving ecosystem of start-ups.”

It’ll be great for 2,000 people who need visas and it’s fantastic that [the government] is going to focus on more jobs outside of London — but I don’t think it’ll be enough

Participant at meeting between No 10 and tech executives

On Brexit, the prime minister said she had no doubt that the UK would remain “a brilliant place to build a tech business”. A Downing Street spokesperson added that there was agreement during the discussion on the need for Britain to take advantage of the opportunity of Brexit “to be bold and ambitious in the action we’re taking to boost the tech sector”.

However, executives said that the visa changes do not go far enough towards plugging the skills gap.

“It’ll be great for 2,000 people who need visas and it’s fantastic that [the government] is going to focus on more jobs outside of London but I don’t think it’ll be enough,” said one person invited to the meeting. “I hope they’ll think of expanding it.”

Technology companies argue that the government should also issue more “tier 2” visas for mid-ranking web and software engineers, who are in short supply in the UK. They contend that start-ups are often ill-equipped to sponsor potential recruits, and have urged the government to relax rules so that venture capital groups or technology accelerators can sponsor employees on behalf of start-ups.

“For start-ups and scale-ups [visas] are time-consuming and expensive,” said Russ Shaw, founder of Tech London Advocates. “If the venture capital firms, accelerators and incubators pick up and sponsor these tier 2 visas then it would take some of the burden from the Home Office.”

Despite government initiatives to encourage Stem — science, technology, engineering and mathematics — subjects at university, the £170bn technology industry relies on EU citizens to fill about 180,000 jobs, according to data from the Recruitment and Employment Confederation trade body.

James Parsons, chief executive of Arrows Group, a recruitment consultancy, said he has seen a sharp reduction in applications from EU citizens since the referendum, with around a third of the technology jobs that he recruits for now being filled by workers from the EU, compared with just over half in 2015.

“The government massively underestimates the competitiveness of our European technology hub counterparts like Lisbon, Zurich, Berlin,” he said. “It’s not even clear to us what their wider policy is and this is a bit like slamming the door after the horse has bolted.”

Tabitha Goldstaub, chief executive of CognitionX, who attended Wednesday’s meeting with Mrs May and Mr Hammond, said it was crucial for the UK to stay ahead in policy terms. “There is more spending to be done, there’s more in terms of using artificial intelligence in government itself and more in terms of unlocking innovation,” she said.

Start-ups have repeatedly raised concerns about possible negative effects on the UK tech scene since the referendum. But many large companies, including Arm Holdings, have said Britain will remain attractive for the sector after it leaves the EU. Arm reported a 24 per cent jump in its number of UK-based staff in the first update by its new owner, SoftBank. SoftBank has committed to creating more than 1,700 British jobs at the chip designer within five years.

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