Changes to requirements for the Skilled Worker visa in the UK are severely hampering Northern Ireland firms’ recruitment plans, research has found.
More than a third (38%) of businesses in the north, responding to the latest quarterly economic survey by the NI Chamber and BDO, admitted they have been impacted by changes to the immigration rules.
This was introduced in April, when the salary threshold necessary to acquire a visa - and which employers now need to pay - soared by 48% from £26,200 to £38,700.
Access to people and skills have already been a persistent challenge for NI Chamber members, with three in four members reporting difficulties recruiting.
Now a further two in five of the 185 Chamber members (together accounting for 44,000 employees) who responded to the latest QES survey say they are directly impacted by the visa changes.
And a notable share of firms are also reporting concerns about the business implications of immigration restrictions on cross-border movements, all of which is adding to cost pressures.
NI Chamber chief executive Suzanne Wylie said: “Competition is now seen as the greatest external issue facing businesses.
“So it’s vital that government in London and Belfast take these challenges for business and the implications for economic growth into account to enable businesses to meet their aspirations and for the Northern Ireland economy to thrive.”
The latest Chamber/BDO research indicates that business performance in the north was generally steady in the second quarter, with some signs of growth and positivity around the current trading environment.
Most businesses are currently trading well (33%) or reasonably well (50%), the highest share since the start of 2023, with the other 17% either just covering costs or struggling (though this figure is down from 23% in quarter one).
Almost all key indicators were positive in the second quarter of the year. Domestic and export order balances were positive, suggesting that more businesses are seeing stronger order books than those seeing any contraction.
But cash flow is a growing concern for both manufacturing and service businesses - more so than any other UK region.
Ms Wylie added: “A weakening cash-flow position not only highlights the need for good payment practices, but also underlines why policy-makers must take note of the impact of the challenges businesses face when operating in a prolonged high-cost trading environment.”
Brian Murphy, managing partner at BDO NI, added: “These survey results clearly show businesses across manufacturing and services are operating with a measured confidence, particularly in relation to investment decisions and turnover growth.
“With the majority of businesses trading either well or reasonably, you can understand where this confidence stems from. It has to be acknowledged though that this is in the face of continuing concerns about the rising cost base businesses are contending with, and the impact this has on cash flows. There’s no doubt that Northern Ireland businesses will be looking carefully at cash flows as they plan for the future.”
He added: “Companies continue to invest in recruitment albeit with the challenge of accessing the right labour force and skills. More and more businesses are proactively trying to address this issue by investing in training and professional development initiatives that allow them better access to a wider range of skills.”
