LONDON (Reuters) – When Efe Cakarel picked London as a new base for his video streaming company, he was counting on its location, capital markets and infrastructure, but also on the city’s reputation as a hub for talented people from Europe and beyond.
Four years later, the 38-year-old entrepreneur has a half-dozen engineering vacancies that he says haven’t been filled for nearly a year because of a local shortage of top-tier programmers. Immigration restrictions, he says, have made it harder to tap into the global pool of talent, costing his 7-year-old startup, MUBI, subscribers and revenue.
“We’re ready to grow, but without the right workers, we just can’t expand,” he said.
Tech entrepreneurs say Cakarel’s experience reflects a broader problem facing London, Europe’s startup hub and an engine of innovative growth. To compete globally, its tech firms need to import talent. But young firms say nationwide curbs on immigration have put constraints on their ability to hire.
One study has found migrants are behind one in seven companies in the UK. The European Commission has said almost half a million tech vacancies may come up in Europe next year and job websites advertise tens of thousands of tech vacancies in Britain, pointing to a bottleneck of talented people from around the globe.
At the same time, cities from Toronto to Sydney are boosting efforts to open their doors to skilled migrants, particularly in the strategic tech sector. TechUK, an industry lobby group, earlier this week called for smarter policies to attract more talent. “There are an incredible number of city-led initiatives worldwide to highlight the effect migration has on cities,” said Kim Turner of the Toronto-based Maytree Project, an immigration think tank.
Entrepreneurs say Australia, New Zealand, Canada, Chile and Germany are some of the national governments that are best responding to the need to attract high-skilled migrants.
London’s situation highlights the mounting tension between the needs of city business and the political mood in the country at large. More than many, the city’s efforts to stay competitive set it against public opinion and the national government.
As in other European economies which have struggled to create jobs since the 2008 financial crisis, migration is a growing concern in Britain. This was crystallised in May when the anti-immigrant UK Independence Party (UKIP) won the biggest share of the vote in European Parliament polls. Its rise has pushed both major parties to toughen their stance on immigration ahead of May 2015 elections.
Prime Minister David Cameron has promised to reduce net migration to the “tens of thousands” from 212,000 in 2013 and recently accompanied law enforcement on a raid on suspected illegal immigrants before holding a press conference in the suspects’ home.
“It is nonsense to suggest our policies prevent companies appointing the skilled workers they need – the number of skilled people coming to work in the UK was up 16 percent last year,” a government spokesman said. “The UK is open for business to the brightest and best migrants and remains an attractive destination for global talent.”
