Immigration in the banking technology industry: a positive story
Naomi Hanrahan-Soar: we should support fintech and bankingtech businesses and their need for brainy, motivated migrants
Like all parts of the tech sector, banking technology suffers from skills shortages and relies heavily on foreign nationals to provide the technical skills required in the workforce. Accordingly, Brexit, and the potential to restrict access to that talent pool, brings additional concerns for employers.
Representatives from some of the leading companies across the tech industry joined forces to host a Migration Advisory Committee (MAC) roundtable in September 2017, coordinated by Lewis Silkin and techUK.
The MAC have been commissioned to advise the Government on the contribution of EEA nationals in the UK to the existing UK resident population and businesses as well as how the post-Brexit immigration system might be aligned with the modern industrial strategy. The tech industry is front and centre to the modern industrial strategy and the largest user of the Tier 2 skilled worker visa to the UK.
The good news is, there is so much positivity about migration in tech and this was reflected in the MAC roundtable. Fintech firms, which often require the most highly and uniquely skilled and well-paid workers in the sector, frequently espouse such views and the role these businesses play in the UK economy should not be underestimated.
It is almost impossible now to think of a business in the UK which does not rely on banking technology support. From the local corner store that needs to accept card payments, to online fashion, grocery delivery apps, and online banking and investment. Banking tech now underpins the growth, or at least management, of almost everything.
As a result, the Government’s industrial strategy is focussed on enabling tech growth through encouraging business activity and developing the appropriate infrastructure and STEAM skills (science, technology, engineering and maths – STEM – with the addition of arts).
Enabling the fintech industry is therefore important to us all. This has most recently been recognised by the doubling of quotas for the Tier 1 Exceptional Talent visa which is very popular for leaders in tech. Banking technology as an employment market uses almost no low skilled migration. Migrant workers are predominantly highly skilled and research papers published over previous years agree that highly skilled migration tends to slightly raise the salaries of settled workers. Essentially, if a fintech company want to bring a star technician to London to work, they are going to have to pay her highly for the move. That then raises the bar for the salaries of her co-workers in similar positions.
The tech industry in the UK is dynamic, global-minded, creative and keenly aware of how important diversity is to problem solving and creativity. This also goes for fintech firms and it’s a commonly held position in the industry to think that hiring the best people from around the world raises the game of everyone in a business.
In the US, the majority of tech unicorns have been founded by immigrants and in the UK one in five tech start-ups are founded by immigrants. Whilst we do not completely understand why this is the case, one migration expert has written about how migrants are exceptionally motivated people, having already taken a leap out of their comfortable home zone.
Furthermore, fintech is global and always creating innovative services and products. Sometimes, a UK business cannot find someone with the necessary skills to do the job in the UK, because there are only a handful of people worldwide with the right skills or experiences for the role. It would be unfortunate for the UK to miss out on innovation and potential for growth because we do not want too many migrants.
Tech companies know they face a skills shortage and they are doing everything they can to attract more home grown talent to the industry. Too few UK graduates study maths to A Level, let alone attain computing qualifications. Many forecasters say that the skills shortage is going to increase year on year, and as a result, tech companies are trying to encourage students to see their potential careers in tech.
London, as a capital for both finance and technology, offers a unique setting for fintech companies and careers to flourish. In an effort to demonstrate the attractiveness of such careers, fintech companies are encouraging schemes such as flexible working so that more women return to work and are consciously upskilling and re-skilling employees. Despite such efforts, fintech and banking technology firms rely heavily on skilled workers from all around the world, including the EU, and preventing a firm from hiring a migrant worker (or making it prohibitively expensive) will not mean an unemployed British graduate will be available to take the job.
There is a long list of reasons why migration in the fintech sector is good for UK business, UK residents and the UK generally. We should support fintech and banking technology businesses and their need for brainy, motivated migrants, because their industry supports all of us.
By Naomi Hanrahan-Soar, senior associate at law firm Lewis Silkin
