Monthly Archives: July 2012

Has the Government’s restriction of Tier 1 visas started to affect the London IT market?

When the Government stopped issuing Tier 1 visas (previously known as the Highly Skilled Migrant Visa) I knew that it was going to affect the IT recruitment market because at least half of the Java developers I had placed that year had either been on a Tier 1 visa, or had residency following 5 years of living and working in this country.

In my opinion this was the first disappointing thing the Conservative-lead coalition Government did. An amateurish and ham-fisted effort to cut down on headline immigration figures, whilst in fact doing nothing to help the domestic labour market and instead hitting the UK economy where it really hurts – in the financial service sector. Not only does the economy need these people, but each Tier 1 visa the Government granted made them thousands of pounds in fees and the migrant would pay tax at the highest rate.

The criteria to qualify for a Tier 1 visa was quite tough: you had to earn something like 40k sterling in your own country, have a significant amount of cash in your bank account and have a specialist skill that the UK had indicted that it was lacking its domestic labour market. And the point is that we really do lack these skills, we just don’t have enough home grown computer scientists, software engineers and IT developers who can hit the high benchmark the financial services industry requires. This is almost definitely a result of the lackadaisical approach to standards we have had in this country for the past 20 years (or more).

But until last Christmas it didn’t really feel like this restriction on immigration had had much affect. I think much of the affect that this should have had, has been masked by a continuing trend to outsource or nearsource by the big investment banks (the banks have long had a presence in global outsourcing centres like India, Singapore and Russia; but more recent the likes of Morgan Stanley and Credit Suisse have also opened centres in Hungary and Wroclaw respectively).

Another mitigating factor has been that many contractors hired in the good years have been let go. Now in the main that doesn’t mean that they have taken up the jobs that permanent developers with Tier 1 visas would normally have taken (these contractors have tended to hold out for another contract rather than take a permanent position), but what it has done is created more opportunities for staff in big companies to move internally; meaning that the big IT employers have had to go to market less than in previous years.

One area where that internal movement has not been able to satisfy staffing requirements, is for graduate and junior positions, and surprise, surprise demand for developers with this small level of experience has increased. So its become much harder for recruiters to find promising junior developers, and starting salaries have been pushed up.

One knock on affect of this tightening of the labour market has of course kept contractor rates artificially high. Normally contractors provide labour market flexibility, and as such their rates go up and down with demand. That is happening to a certain extent, but many contractor rates are remaining at, or around, 2010 levels.

So what’s going to happen next?

The country used to grant Tier 1 visas to make up for shortfalls in very specific, highly skilled workers, that the UK could not provide domestically. The logical result of this is going to be more off and near-shoring, incidences of companies providing visas will become commonplace (as is already starting to happen), migration across the EU will continue to increase (we are already seeing lots of Greek programmers coming to London for instance) and sadly smaller IT dependent companies are going to start looking to establish themselves elsewhere.

Talent and entrepreneurialism are the only things that we can rely on to get ourselves out of this recession and remain a leading force in the market, we need to invest more in education now!

Speak like a recruiter 101: “The moon on a stick”

the moon on a stick (spoken)
impossible to get    Gavin: “Back from your client meeting? What is he looking for this time?” Sandy: “The moon on a stick”
Etymology: based on the notion that that somethings just don’t exist
See also: rare, uncommon, hopeless, naive

Redundancy money = fool’s gold?

It’s a sign of the market when the amount of people I’m talking to have been made redundant is steadily increasing. And the annoying thing is too many people only come to me months after they have left the company, sometimes 6 months of unemployment, and I ask – is the pay-off worth it?

Gone are the days when it was 2 years up-front salary, today its more likely to be 1 year’s if you stay at the company until the end of the consultation period. In return they want you to stay working for them, handing over everything nicely until they are ready for you to go. This is the bargain.

In my experience its not worth it. Yes you get a big sum of money you can put towards your mortgage or whatever, but is it worth the period of unemployment that inevitably follows? Is it worth the disruption to your career path? Or the stigma of having been “made redundant”?

A lot of people seem to first react with a head-in-the-sand approach whilst the consultation goes on, and then I suspect that rather than tackle this change of plan head-on, the idea of a couple of months “holiday” starts to grow on them. And it’s always a surprise to me how long people last, I suppose the injection of all that immediate cash keeps the show on the road for a while. I get the impression the holiday idea wears off pretty soon once the cold, hard reality of what is essentially unemployment kicks in.

And then it seems to be a period of time before they contact a recruiter as well – madness.

In short I just don’t think the cash is worth the potential misery of 3 months unemployment.

So here is my advice to anyone put “at risk” of redundancy:

– Start your jobsearch immediately. Get real. You have been fired. It wasn’t through any fault of your own – which really sucks – but now you have to focus all your energies on getting a better job right away.

– Update your CV, brush the cobwebs off your Linked IN profile and add your contact details to your home page, start applying for adverts and get your CV on the jobboards.

– Network! Think – who do you know who might be worth getting in contact with. Whether they can help you directly or they will know someone who can, it is always worth getting the message out that you are looking

– Start preparing for interviews. Annoyingly the chances are that the first interview you get will be for a really good job. So start preparing early! If you are a techie – there are plenty of resources out there, from the answers to all the threading questions there are to taking a brainbench test and working out where your weak points are before an interviewer does.