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Why businesses want to recruit from overseas

Robert Peston | 08:18 UK time, Friday, 17 September 2010

As luck would have it, I bumped into the boss of one of our largest manufacturing exporters last night, who complained that his ability to expand in the UK was being seriously hampered by the new restrictions on his ability to hire from outside the European Union, that have been imposed by the coalition government.

Vince Cable


And he also queried whether Vince Cable was the ideal choice for business secretary, since he was unpersuaded that Mr Cable would bat aggressively enough on behalf of businesses like his.

Vince Cable would say it's not his job to bat for this or that company in a partisan sense, or for the entire private sector: his role (probably) is to use whatever micro-economic tools he has to promote economic growth and wealth creation.

Even so he's plainly been hearing quite a lot of complaints akin to those made by that industrial grandee, given his statement to today's FT [registration required] that "a lot of damage is being done to British industry " by the immigration cap.

There are two issues here: one is whether a coalition government can hold together when one of the most influential members of the minority partners in the administration is so scathing of a central government policy.

But the other is whether Mr Cable is right, that the reduced limits on the flow of skilled individuals from outside the UK is harming the economy and therefore hurting the majority of us.

For most people, there seems to be a contradiction here. Surely if jobs aren't going to managers, engineers, micro-biologists or bankers from India, the US and Hong Kong, they must be going to Brits - which would surely be a good thing.

And this is presumably what David Cameron and George Osborne believe, or they wouldn't have imposed the cap.

However, my manufacturer says that the pool of highly skilled people just isn't wide enough or deep enough in the UK. And in recent weeks I have heard identical comments from bankers, software designers, drug makers and so on.

So if they want to invest and grow in the UK, they argue that they must have the ability to import the best talent from the rest of the world.

Of course, in theory, if the best talent, at the cheapest price, isn't being bought from India, perhaps we'll grow more of the skills we need here in the UK.

The problem is that the required nurturing of so-called human capital takes years.

And British-based businesses want to expand now.

Here's the serious concern: if there are skill constraints on their ability to grow in the UK, they'll take their investment to other countries where the appropriate skills can be obtained.

That would be a concern at a time when public spending cuts are having a seriously dampening impact on an already weak economy - and when the government is relying on private-sector growth to take up the slack.

So, for example, the Office for Budget Responsibility says that if the economy is to grow next year by 2.3%, just over a third of that growth will have to come from increases in business investment and a little bit more will be dependent on improvements in the balance of trade.

Or to put it another way, if businesses choose instead not to invest, and the UK's exporting capacity doesn't increase, growth of 2.3% would shrink to something derisory.

What many businesses have said to me is that it is all very well for the government to turn to them to re-stimulate the economy, and they would like to rise to the challenge, but restricting their ability to buy from across the world is a binding, painful fetter.


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  • Comment number 1.

    Well robert, the 'grandees' would say that - they want talent but at a cheaper price. I am assuming they would be importing them from India and not from, say, USA. Tough to them. Start investing in our home grown population.

  • Comment number 2.

    The labour market is a market and a shortage of skills should be celebrated as at last someone except for con artists (sorry I mean bankers) is getting a good wage. What is the point of surpressing wages? Yes it reduces inflation, but that is only good for creating credit bubbles.

    Do we really want Indian wage levels? We really want the people with skills to earn money and there to be a demand for our people. Demand = Opportunity and Money = Incentive to learn the skills.

    A short term skills shortage is the long term road to prosperity for British people who are already here and are not themselves employers.

    Are we so messed up we cannot give ourselves a long term better deal over the present vested interest groups of international business and political correctness?

  • Comment number 3.

    Yes Robert - very "lucky".

    "The problem is that the required nurturing of so-called human capital takes years"

    You mean to say New Labour's much trumpeted transformation of the academic achievements of our children is really just a con?

  • Comment number 4.

    I run a business too and I find that many UK companies simply do not train staff, what do we do keep importing trained poeople or train some here in the UK, this lack of investment particulary in young people has been going on for decades, I was the last apprentice taken on by the company I worked for in 1979 when the then Tory government stopped assisting with training budgets and the following labour governments ignored the issue as well, what will the unskilled untrained children of the incoming migrant workers do when they grow up. We simply cannot keep importing skilled workers not when so many have no skills and no hope here it just me or do many of the migrenat skilled workers seem to serve me coffee in service stations?

  • Comment number 5.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 6.

    I find it astonishing that British business want to bring in yet more overseas people into the country at a time when the nation desperately needs to transform its workforce. Haven't they heard of in house training? It is vital that British people pick up any jobs that are created through a growth period. It seems as long as they earn their massive salaries and bonuses British business leaders don't give a fig for British people. There has to be an end to everything being targeted around Business profits.....British companies could easily increase their training budgets, but they won't.

  • Comment number 7.

    Too right! (as in 'correct') Robert

    The whole approach is wrong. The focus should be on what do we want to build. The government should be aiming to create conditions where this can happen. Making cuts, creating restriction may be part of what we have to do to get there. But the present climate seems to see cuts and restricting immigration as ends in themselves. A vibrant economy with high levels of employment (real jobs) whilst caring for the disadvantaged is what we should be aiming for.

    Cuts and immigration controls may be part of the overall package which will get us there, but I cannot feel confident that an expansion in business will just happen in sufficiently large measure by making cuts and restricting immigration. If you set off on a journey don't you decide where you want to go and then you plan the route? I know targets are a dirty word, but some objectives would be good. The point being that if I like where I'm going, the prospect of a bad jorney is not so bad. Low cost airlines have found that to be a successful business model.

  • Comment number 8.

    You have not considered two other points: salaries are significantly lower overseas, and traditionally UK businesses haven't valued highly technical employees.

    Why on earth should someone enter a career in which they aren't valued, either financially or, more importantly, for the work they create?

  • Comment number 9.

    Robert - if this individual is so correct re the restrictions on being able to import foreign labour, as that is what we are talking about in its most basic terms. Why not identify the individual and his company.

    Companies now are just like individuals - we must nave it now and damn the long term consequences - not prepared to invest in the resources they already have, training individuals to do the role they require. What else does this also say about the companies long term recruitment policy in respect of its current employees? We'll employ you for role "X", but its pointless us developing you, because you're not really good enough for us to invest in you and we don't really think you are capable in achieving a greater role or being able to transfer your limited skills into another role.

  • Comment number 10.

    Seems a similar problem to the premier league, do managers use homegrown overseas talent, but there doesn't seem to be any solution there either.

    Managers want the talent now, those looking to the longterm want to give the homegrown a chance. But the homegrown talent just isn't good enough to compete.

  • Comment number 11.

    > As luck would have it, I bumped into the boss of one of
    > our largest manufacturing exporters last night, who complained
    > that his ability to expand in the UK was being seriously hampered
    > by the new restrictions on his ability to hire from outside the
    > European Union, that have been imposed by the coalition government.

    They're all at it - they'd rather hire some foreign geezer on the cheap, than hire a Brit.

    > my manufacturer says that the pool of highly skilled people just
    > isn't wide enough or deep enough in the UK. And in recent weeks I
    > have heard identical comments from bankers, software designers,
    > drug makers and so on.

    Well, I think we can all agree that it's stupid to suggest that bankers are highly
    skilled - we've got more skill in our little fingers than any banker has in his whole

    Hm.. software designers? That's hard work, and should attract high pay. But bankers are ten a penny.

  • Comment number 12.

    I'm sorry but your manufacturing mate just needs to take a long term view here. Large UK businesses (and especially the banks) must be incentivised to make the required investment and take the time to nurture appropriate skills in people already in this country. The reality is that very few jobs either in the City or industry are extremely hard and businesses just need to be prepared to do a certain amount of retraining and not expect to take people off the shelf with years of experience doing precisely the same thing...

  • Comment number 13.

    The lack of skills in the UK might be blamed on the failure to industry to train people in the past. It will take a long time to change the present situation but allowing businesses to recruit people from overseas means they have no incentive to train people in the UK. Perhaps businesses should be allowed an exemption from the cap if they agree to train one person in the UK for every person they recruit from abroad. Unfortunately this would be very complicated (and costly) to administer, so is not really a practical answer.

    This issue is another condemnation of the UK education system which produces lots of people with grade As from school and first class degrees but no useful skills. Complaining about the cap is an easy way for businesses to say they cannot achieve what they want want, but they need to be involved in developing a policy which will remove the need to hire people from abroad because in the future (after following this policy) there will be trained people in the UK.

  • Comment number 14.

    I am not sure about in the rest of the EU, but i've always thought that the fact that some of our young people are left to rot, and that others do not seem to reach their full potential in our education system, would always come back and bite us as a nation at some point.
    Why not suffer some short term pain and try to develop our own young people for all the skills we shall require as a country in the future, and at the same time give everyone from ALL backgrounds real hope of a better life.
    It seems pointless to let our young people 'slip through the net' and then have to recruit from overseas, esp. with all the additional burden that points on this small island.

  • Comment number 15.

    "However, my manufacturer says that the pool of highly skilled people just isn't wide enough or deep enough in the UK."

    In the IT sector that is definitely untrue. What is really happening is that a lot of overseas owned companies need to import low cost e.g. Indian programmers so that can undercut UK companies because their cost base is so much lower. In my own experience many of the software developers from India can only work following rigid methodologies as there is a lack of innovation and understanding for the problems they are working on. the result is that larger teams of people are needed though the costs are so much lower (staff salaries) they can still massively undercut UK companies. Fortunately for such companies these days the reduce their UK staff to only those necessary for UK customer facing work (sales, project management, minimal support, etc.) and most of the work is carried out overseas. But they still need those cheap customer facing staff. So what will happen with immigration caps is that those companies will no longer be able to undercut UK companies and the business will be done by UK employees working for UK companies keeping the profits in the UK.

  • Comment number 16.


    It has nothing to do with a lack of skills.

    This manufacturer wants to hire from outside the EU!!!!!!

    Are you trying to tell me that the skills pool in the entire EU is not 'wide and deep' enough????

    It is all about importing CHEAP, unskilled labour.

    Calling it a skills shortage is a laod of rubbish!!!!

  • Comment number 17.

    I think that the argument about a poor pool of talent is self-serving. I am a graduate with a post-graduate qualification in Systems Analysis and Design. I was working at one of the largest companies in the world when my employers, who were the outsourced suppliers of IT services, lost their contract and was forced to make me and many of my colleagues redundant. The reason? The new Indian suppliers provided three men to do two men's jobs for half the price. So in this case the reason for employing non EU personnel was nothing to do with shortages of talent, it was purely financial.

  • Comment number 18.

    So we're back to the same old problem, your friend the "businessman" is only interested in increasing his own wealth by employing people at a minimum wage.

    We have over the last 30 years through politicians allowing products to flow in from countries where the working conditions are frankly appaling created a situation where if we want to make things in the UK and be competitive our workers will have to work in those same conditions. It's not a level playing field.

    Those same governments have worshipped the square mile of money magicians and encouraged our best brains into the financial "industries" where they can make huge amounts of money and produce nothing whilst at the same time looking down on the world of engineering.

    The DAILY turnover in the world Foreign Exchange markets was $3.2 Trillion in 2007, the worlds total economic output for ONE YEAR is $70 Trillion today. Think about that....

    You reap what you sow.

  • Comment number 19.

    So they are saying that throughout the EU there isn't the people to do the jobs they want.

    Rubbish. What they want is cheap labour that somebody else has paid to train so that they can maintain their profit levels, and you know it.

    Salary levels in the IT industry alone have halved or more over the last ten years. That is not a market short of staff.

    It's time to call their bluff. No evidence of sustained salary spikes, no visa.

  • Comment number 20.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 21.

    I think the quality of UK University education is quite poor. The institution I attended, gave us 5hours of lectures per week with another 5hours of seminars. 10hrs per week for 32 weeks of the year for 3 years = £15k in debt. Most of my lecturers were too busy working on research for banks/think tanks/government institutions. Compared to my european/asian/american counterparts, I would say most of their bachelor level degrees were equivalent to our masters in the UK.

  • Comment number 22.

    I can tell you... having completed a science PhD at a top university that there are very companies out there willing to take on new science graduates (despite all the talk about developing a knowledge economy!).

    Typically companies recruiting for technical roles are after "plug and play" experienced personnel who will slot right in. Hence you end up with highly skilled graduates going for roles in: -
    - banking/services/sales roles (which pay better and are more flexible on academic/experience requirements - so long as you can play the graduate recruitment game and are still young enough to go in that way)
    - temping whilst looking for the company that will give them an opening in a technical/scientific profession.

    For all the talk about valuing education, the opportunities for the most highly educated are not as great as the government makes out (at least in the first instance) and the pay is frankly often little better than an average salary (despite all the debit involved in getting that education). Hardly surprising that people don't opt for that a risking and frankly low earning route through life.

    Meanwhile over in developing nations such roles are highly prised with earning potential multiple times higher than the average salaries. Is it therefore surprising that there is so much more "talent" in such countries.

  • Comment number 23.

    Robert Peston: "And this is presumably what David Cameron and George Osborne believe, or they wouldn't have imposed the cap."


    God forbid they imposed it for political rather than economic reasons.

  • Comment number 24.

    Many of the comments here suggest that companies who can't recruit from overseas will be forced to take skilled workers from the UK instead. Whilst this might be a nice idea in theory it doesn't work like that in practice. It is much more likely that the whole task will be given to an overseas contractor with consequently an even greater loss of skilled work available in the UK.

  • Comment number 25.

    @ 17. At 09:31am on 17 Sep 2010, Andrew Street wrote:

    > the reason for employing non EU personnel was nothing to do
    > with shortages of talent, it was purely financial.

    Those "bosses" are unpatriotic. They are putting themselves before the needs of their country. They are not fit to live in Britain, and they should be expelled.

  • Comment number 26.

    Nice to see that the critics of globalisation are out in force early this morning.

    It is of course utterly disgraceful that India and China turn out so many well qualified graduates. How dare they work for a wage that, in their country is good, but for the UK would be below minimum acceptable levels. Indeed how dare those countries try to improve their economic lot.

    The complaints are about lack of skills not salary levels. In other industries the complaints are also about commitment to work. For example in many parts of the country most of the jobbing builders are Polish and Brits looking for simple repair jobs are happy to hire them. Is it because the Poles are a lot cheaper or because they turn up every day just before 8am and do a full days hard work to get the job finished on time and at least within spitting distance of the original estimate (they are builders so they will rarely if ever actually only bill the original estimate !) as opposed to turning up some time after 9 am with the cheery starting comment of "sorry gov, traffic" and then spent the next 30-40 mins making tea.

    As for software development, ICT in schools does not even teach programming. All ICT prepares schoolkids for is being able to work the word processor

  • Comment number 27.

    There is masses of highly skilled software design talent in the UK, and a good chunk of it is unemployed. The problem is not lack of talent but the desire to have that talent for peanuts (while paying the shareholders and bosses massive amounts for doing as little as possible, of course).

    This is a global issue and it is a classic case of needing some protectionism. While a foreign country is prepared to let its workforce suffer bad pay, bad and unhealthy conditions, and oppressive political restrictions we in the West owe it not only to ourselves but, in the long term, to the people in those countries to refuse to deal with them or import their goods/services/migrants.

    Globalization is creating a new Golden Age of slavery, which is slowly being imported even into our own country.

    People who pretend that there is a skill shortage when in fact all there is is people who want paid for their work are part of the problem and Vince Cable, and everyone else, should be happy to ostracise them from decent society.

  • Comment number 28.

    It is the age old answer:-

    The problem with immigrants is that they learn too quickly (Ascribed to: US Steel's owner at the start of the growth of the US economy bemoaning the continual need to fire the existing workforce when they found out that they were being exploited and underpaid and recruit new immigrants.)

    The problem with the employing the well skilled (and probably better skilled) indigenous population is that you have to pay them more because they need to buy a hugely overpriced house whereas temporary employees will only seek a cheap flat.

    In other words: to put it very starkly, the employment chances of British employees are damaged because of the idiotically high price of houses here. Or the Banks and Mervyn King have stolen your job!

  • Comment number 29.

    It's not always about wages. Because Britain has no business plan, we've not generated anywhere enough engineers ( not technicians, engineers, the people who design things). Over the last decade, all of our bright young things have gone into financial services, not engineering, resulting in a shortage of people who can design or make things.

    You can on job train incremental skills, but you can't turn a technician into an engineer. This takes about 3 years of uni and 3-5 years of on the job training.

    So whilst there may be a wage issue, if an Indian or American is imported into the UK for an engineering job, I would expect that they would be paid the going wage. It just so happens that India and the US are stuffed full of engineers rather than financial salesman.

    Is this the fault of UK business? Well similar to our financial debates, it is, but the purpose of goverment is to thing long term, beyond the short term thoughts of their citizens. Unless UK PLC writes a rolling business plan for the next 10 years plus, to plan and educate our citizens for the real world, we are doomed to fail. Again and again.

  • Comment number 30.

    Oh, this country!

    Yes it is in a serious mess. This week I had a letter from my landlord for my business telling me my rent is going up an extra 250.00 per month in 2 weeks time. The landlord is british! I am closing the business down because in 3 months time it can go to 1000, extra who knows! but this is the problem....greed.

    It is not the fact the british are lazy it is the greed, the high rents which when people are working they pay all the money out for rent and end up with nothing. So when things are affordable then people will want to work more and save more but as long as rents are high and there is no way of saving a penny the people on benefits are being exploited, they work more and rents go up so by the time they pay bus fairs etc they have less money for the gas, electric and food. Have less time nurturing or looking after elderly family members and children and no money.

    Me, I am closing my business down and having to get rid of the staff because I can not afford the extra rent and I will take my skills abroad. As long as their are expensive businesses and houses the country is hindering development. Why should people be exploited for some landlord to sit back and make money off hte back of someones hard income.

    You want british workers but they are being exploited, foreign workers are gaining more skills because cost of housing and businesses are more affordable abroad so they can afford to invest in themselves with skills. So the only people able to do the jobs are foreign workers as the british have not had the means to be able to afford training and paying rents. What the british should do is all move abroad where houses and business and training is cheaper and just as good as the UK! I am now, I can afford to have a better standard of life, work and pay my rent easily and have money over to re-invest or be able to have a meal out once a week and enjoy some entertainment.

    The trouble is now the UK will not be able to keep the skilled people in the UK because of the cost here, unless you are a landlord of course, but why should anyone need to be in that position of having to exploit vunerable working or non working people? This government is not investing in the right places and putting more money in the banks is just a small part of the bigger picture.

    People are skilled but can not afford to live here, I have so many qualifications and very popular but I can not afford to buy premises and everytime I earn more the landlord puts the price up!

  • Comment number 31.

    This country can do without people like Vince Cable, who it would appear is stabbing British workers in the back by trying to export out British Jobs to foreigners. Businesses want to recruit overseas workers because they do not want to pay UK rates and want to import cheap foreign Labour.

    The Labour government has brought in millions of immigrants over the past 13 years. Why can't businesses employ these immigrants - they have millions to choose from. In effect business is saying that that all millions of immigrants are incapable of doing the work required by businesses, if that's the case why have they been brought into the country.

  • Comment number 32.

    There are some very good points above that I totally agree with. When I worked for the MoD, my particular branch trained 1000+ engineers and 100+ scientists every year for well over 20 years. Now that branch has been privatised they train precisely, zero.

    When my son was deciding on his degree Engineering was 'far too hard' opting for media studies instead. Perhaps if the disciplines that we require were free then that might have helped persuade.

    Lastly, engineers that have completed their degrees have often been lured into banking and because that industry rewards and values their skills.

    Lastly I very much doubt that the particular 'grandee' would be happy living and operating in New Delhi, where despite all the recent headlines it is very hard for a non Indian business to operate and a tough place to live.

    We certainly need immigration, we are getting too old as a nation, but not just to provide lazy, short termist companies with a quick buck.

  • Comment number 33.

    This is the lunacy of our system.

    For as long as there is anyone signing on unemployed, no-one should be allowed to hire from outside the UK.

    I expect people will argue about the costs (after all, people will want to be paid at least a living wage) but put it this way - if you're not spending billions on unemployment benefit, you're not having to tax individuals and businesses in order to provide that benefit.

  • Comment number 34.

    #3 not_Shakespeare

    "You mean to say New Labour's much trumpeted transformation of the academic achievements of our children is really just a con?"

    Of course, but that's not the problem. Our school leavers are no less intelligent than their predecessors who made our nation great. The problems are:

    1) We undervalue engineers and people who make stuff but love bankers and celebrities. We're more interested in getting rich than doing things well.

    2) We look down on people who "get their hands dirty" in industries that make stuff and I don't just mean the people on the shop floor.

    3) Our government deliberately enacted weak laws for the financial sector to encourage international financial companies to base themselves here. This is a matter of historical fact. The BBC did a documentary about it 7 or 8 years ago and when they interviewed the people in charge of these companies they said that the reason they were in London was because they were allowed to do things that were illegal in other parts of the world. Well done us, we helped create the world slump because our politicians are in the pockets of the financial sector.

    #4 Tony

    A very good point but who's at fault here, I agree that the govenments you mentioned haven't covered themselves in glory but surely it's down to an individual business to run apprenticeships becuase there a good thing not wait to be helped by government?

    One of the biggest problems we face in Britain is that our pool of top business talent is full of people who are poor at what they do, get paid too much and got to where they are by bullying and/or taking outrageous risks. You can see this from the way that business leaders can utterly mess up a company and then get another highly paid responsible job somewhere else.

    #6 Nick

    "I find it astonishing that British business want to bring in yet more overseas people into the country at a time when the nation desperately needs to transform its workforce."

    You don't mean that do you :-). The people at the top of our industries are only interested in their own pay packet (there are honourable exceptions). Business leaders are in general arrogant, unaware of their own good fortune and see themselves as part of a wealthy elite who can bounce around the globe calling no country their home. If it got them an increased bonus they would happily see the home counties turned into a holding area for foreign labour ;-)

  • Comment number 35.

    There is clearly something wrong here. I agree with others that the EU skills pool ought to be deep enough. Tere are certainly many well qualified people around. And it may well be that in some cases industry is looking for cheaper alternatives from outside the EU.

    But that having been said, the UK has been investing in education (education, education) and ensuring that 50% of people have a degree. So if there is a skills shortage we have to ask why? Could part, or all, of the problem the steady devaluation of qualifications through a mix of lower standards, inappropriate courses, and plain dilution?

    It is also true that there has been a reduction in the level of in-house training (companies bringing on their own people). Is this because it's cheaper to buy in the skills which someone else (usually Government) has invested in: and/or because if you invest in someone they can then take their new skills and get a better job elsewhere?

    In any event, bringing in people from outside the EU may be a short term solution: but it does not solve the long term problem. We can't complain that someone has "taken our jobs" if we are not trained to do those jobs in the first place.

  • Comment number 36.

    Well, if the anonymous exporter had his way, at least the Government could save money by axing computer science and similar degree courses where British graduates cannot find jobs thanks to a previous open-door policy to non-EU immigration (even "meeja" studies grads fare better).

    In short anyone who has to make their way in this, their country of birth, pay their taxes, redeem their student loan, just cannot compete with the low cost base of imported workers.

    The skills shortage is a myth perpetuated by your "friend" and his ilk, to keep the doors open for a supply of cheap labour. Forget social consequences - I'm alright, Jack.

    Who was it said we're like a third world country?

  • Comment number 37.

    In terms of numbers, immigration of skilled professionals is not large enough to affect the non-EU quota much. Nor is it going to keep UK residents out of work since the particular skills in question are supposedly unavailable in the UK. It seems to me that the bulk of non-EU immigration has to do with less skilled jobs than those mentioned. Is this just a political problem?

  • Comment number 38.

    Maybe the British people themselves are partly to blame for this. Before we start pointing the finger at businesses, we should probably also understand that the British should be atleast ready or willing to do certain jobs. I studied as an actuary in the UK and there were barely any British students in my batch. The few who were in my batch were very talented and have gone to to work for huge companies, but most other British students would do degrees like Drama which is interesting but doesn't prepare them for a broad range of jobs. In the actuarial field, the lack of British talent isn't due to businesses not recruiting British people, but a lack in British people willing to enter the field. It's the same for a lot of professional jobs. If the firm I worked for didn't recruit overseas, it would probably be unable to even operate. And it's not like it's very easy for the firm to recruit overseas, or that they ditch British talent for overseas talent, there is a lot of red tape involved, but they are desperate and they need to do it.

  • Comment number 39.

    Business leaders say what is best for their business and their own remuneration and not what is necessarily best for the majority of people in this country .... and surprsie, surprise ... many of them are now 'foreigners' and with no constructive or social interest in Britain and British people beyond their own banks balances and business peer environment.

    The trouble with Mr Cable and I myself have supported many of his ideas on banking etc and pontifications from when he was in opposition ... is that bleating on about needing more immigrants is easier than creating a single job for a single British worker.

    I'm afraid that in terms of real job creation for real British people, Mr Cable is totally useless and incompetent ... and these are the same people who have voted for him on the expectation that he would do something real ... to help them find employment and a secure income.

    The real issue is that Mr Cable is selective in speaking to the highest tech end of industry and where high skill levels are, of course, needed ... but the reality is that Britain needs many more low and lower end and manual skilled jobs so that everyone who is British and wants and is able to work in the UK ... stands a reasonable chance of finding a reasonably well paid job.

    Mr Cable needs to do something more than pontificate in his appeasement of his liberal globalised conspirators and should be demanding of business that they train and taken on British unemployed.

    If we have companies in Britian who are not willing to work with British students and British workers and keep threatening to leave the UK all of the time then maybe Britain is not the right place for them and they should either shut up and help people or take their businesses overseas.

    Britain/our govt has to make some harsh decision whether to leave 8 million inactive poeple with very little prospect of ever getting employment or introduce radical projects and proposals to help them and togther with an additional 5 million people in poorly paid jobs also.

    The Coalition govt can put millions of British people back to work very quickly by manipulating import tariffs/domestic aggregate demand that can be 'created' by import tariff opportunities and duties on imported products that we should be making or finishing here in the UK and by e.g. taxing say putting a couple of thousand quid on a BMW car higher end/consumption vehicles but not ona British made 'green' equivalent.

    WTO and GATT is about 20 years behind with trade tariffs and Britain is getting hammered by greedy importers milking our credit cards/lenders and getting us into debt as encouraged by the previous Labour govt.

    The 5 million or so immigrants taken in by New Labour during the last 13 years have been/are taking hundreds of biliions of pounds from British students/taxpayers and workers every year in the form of wages, salaries, benefits, free health care, housing etc etc.

    Cable/the BBC/media never ever mention any of this this!

    I think it is high time that Mr Cable tried to do something for the ordinary people in this country and stop sucking up to big business and bleating his 'we need more and more immigrants' .... No! Mr Cable ...


    Can you create a single real British job Mr Cable and give it to a British person?

    For goodness sake Mr Cable ... stop worrying about foreigners and what foreigners think all of your time and do something for ordinary British people and not just the privileged well educated that attach to you and your political and business class.

    Can someone ... please, please ... sack him!

  • Comment number 40.

    Why don't we start recruiting from the 'new third world'?

    Look at the progress capitalism is making, 1 in 7 living in poverty in "the richest nation in the world" and businesses here are complaining that they cannot "re-ignite the slave trade" - only using debt instead of actual chains because the indegenous population has become too expensive, or doesn't have the skills required to do much more than manual work (that would be down to the lack of investment in education and training over the last 30 years or so)

    "For most people, there seems to be a contradiction here."

    Just the one Robert? - if you look carefully you will see there are thousands of them residing within Capitalism. One thing capitalism produces in abundance is contradictions.

    "The problem is that the required nurturing of so-called human capital takes years."

    ...not in the Capitalists view - we can hire and fire as we please and if the current workforce don't like it - then we can always get a new workforce (at less cost) - so what if the customer suffers - "They can always go elsewhere" - and like with the utilities the customer spends a lot of time 'switching' from one supplier to another - the height of efficiency for the consumer there then.

    "So, for example, the Office for Budget Responsibility says that if the economy is to grow next year by 2.3%, just over a third of that growth will have to come from increases in business investment and a little bit more will be dependent on improvements in the balance of trade"

    Fat chance of that - the Japanese have just 'devalued' through the purchase of dollars and soon the Americans will be doing their bit. I mean we're all hoping for an 'export led recovery' - so who's doing all the importing?

    It's all a stack of lies built up over time - eventually this will crack and fall and there will be claims of surprise from those delluded enough to believe their own deceit.

  • Comment number 41.

    But does he have decent data to support his argument? How many unemployed people have they interviewed, for example? How do we know the bosses are looking hard enough if at all? What does he want, sympathy? Doesn't he get paid enough to come up with a solution to his apparent problem?

    Has he tried offering spiv banker level wages and condition? Mr Businessman have you ever considered not externalising the costs of training employees? You know, perhaps training and providing experience yourself? Didn't you invest appropriately in your staff and business? Bad planning perhaps? If a business can't afford that then they are either in a dying industry, paying too much to the bosses and claiming to much in profits. Do it right and you could even write the next Business Management Innovation on Businesses not depending on state welfare or pinching other people's employees/nationals! It's so novel for this century! It'll be an International best seller available at all airports.

    Way back around 1998-1999 Radio 5 Live had a phone in. The HR girl was complaining about Brits lacking in qualifications and explaining why Brits couldn't get a job. A listener called in. She pointed out that a large international bank had just been hacked (expensive!) the week before. The bank had refused to interview her because she 'lacked experience'. All of the banks had ignored her she said. Well, this particular woman had completed a PhD about a year earlier - on computer security, of all things and no one would hire her.

    The HR person then changed tack faster than you could bat an eyelid and whined on about how the listener needed experience. The HR needed to find out what a PhD is before her bosses realised how inept she was! Because that listener was one of the few people on the planet who happened to know how to reduce the vulnerability of banks to hackers. She was the expert! Computer scientists don't normally get a PhD for reading a text book! That HR woman had no idea what a fool she sounded like on national radio. Sad, hilarious, and a pathetic lack of HR ability, but so common among British spiv businesses!

    I know one or two people who are now out of work. Exceptional qualifications and experience. It's a nightmare for them and they say it is like being branded as useless, unable to read or write, etc, written off and berated in the press just for being unlucky. Maybe the employers are expecting the unemployed to be the confident people they are capable of being, but just not quite so confident while they are suffering in poverty and the misery of unemployment? It doesn't take long for the effects of unemployment to show so maybe these employers should understand and be more flexible just like they demand of us!

    Could it be that now the employers have a flexible and frightened workforce they just don't like what they see and want something else? But we'll never know now will we, not with 40% cuts to everything including academic research.

    Perhaps the government could help by matching up the over-qualified unemployed and under-employed with these business men.

    The UK scientists will be down at Downing Street on 9th October if you are looking for any bright sparks. And there are loads of experienced, educated people on the dole.

    So improve your search strategies and corporate policy on investing in people Mr Businessman! Exceptional employees aren't the same as the cheap food you get out of a fast food joint.

  • Comment number 42.

    In my experience in running a software business you only get cheap rates if most of the work is relocated to India where you can pay cheap wages. You might still have a few people based here in the UK but they get paid a lot more, otherwise they leave for another better paid job. It is a misperception to think that people will come over from India and live here for years on much lower wages. They don't. Business is not long term, it is always about the moment, especially technology where the skills needed change so fast. What you need are people who never want to stop learning. I'm afraid there are many countries where the people have much less than we have in the UK and are much hungrier as a result. In software the difference in productivity between employees can be as high as 10 times. Wages is only part of the equation. Of course if the culture of an organisation is to bring everyone down to the same low level then wages become the only factor in cost...

  • Comment number 43.

    I've seen 17 comments moderated so far. Obviously, none of the authors ever run own business. All the authors completely miss the most important point -- international competition. Regardless how much talented and trained UK workers are, if they ask 3, 5 or 10 times more for the same job Indians can do the company they work with will go bust. Absolutely nothing can be done with except working harder for less to compete with Indians. Anyone who is unhappy with this simple fact of life -- welcome to the benefit system. Plus all those moaning about lack of training in UK companies, please, ask yourself a question -- where are all those migrants trained? You think you know Indian business so well that you've got no doubts at all that Indian business trains newbies? Education is not a business problem, it's individual's and government problem. The more socialistic claims for business to train people are made, the more business will be outsourced and UK economy suffer. UK business is global, so is the competition. Cut UK immigration, you'll have no jobs in the country at all; IT, programming, accounting, engineering -- everything will be either outsourced or bankrupt.

  • Comment number 44.

    The comments about wanting to obtain cheaper labour rather than the only source of skilled labour may well be true. Why not change immigration policy so there is a higher tier of entry where the prospective employer can show the skills are not available and that they have identified a suitable candidate who would otherwise not be admitted. This will solve the complaint or put the lie to it. The business should pay a fee to cover the admin effort involved and declare the salary - which would have to be realistic to attract a European candidate of suitable calibre. I do believe other countries have such schemes and their businesses also know when they will not succeed in wool pulling.

  • Comment number 45.

    Companies should take on apprentices.......

    Of course, that is not the cheap option.

  • Comment number 46.

    Well I personally thought the cap idea was kind of silly. I agree there should be more employees recruiting those already resident in this country but as you say, if you're looking for the best person for the job then that person may not be a resident of this country.

    So, considering the number of unemployed and the lack of talent as seen by business creates an interesting perception on both our society's attitude towards developing a wide range of skills that can benefit the country and the level of achievement provided in educational institutions.

    From my experience going through the education system, I can agree that there is a problem of complacency in our society and a negative perception on certain trades and skills that has become stereotypically engraved in to many parts of our society. This leads to students only wanting to do certain subjects because they see other subjects as being something that is for other people to do, as if there is a perceived class structure based on what subjects you do and what career path you want to follow, which leads to people not wanting to be seen as part of the lower class work force.

    If we perform badly at school, it becomes a stigma attached to being seen as a complete failure and that you'll never amount to anything while those who do well at school are constantly encouraged to further their education and to do certain degrees. This has led to less growth of skills in certain sectors and industries. This can all lead to people never really finding the skills that can help them find a job they would really want to do while all the skills that are developed by a greater number of people than there are jobs requiring those skills.

    This is all part of the circular flow of unsustainability that this country has been built on. This country has lost much talent over the decades from loss of industries and sectors because they are simply seen as jobs that other people should be doing and of course, other countries have filled the gap in the market. Now at a time when we have chosen a path of limiting the skills that are most essential in our country based on our negative perceptions we have hit a crisis that is forcing businesses to turn away from the local people that could provide a suitable work force.

    Now is the time to start focusing on realising that what this country needs now is a diverse set of skills so that we can become self sustainable on what we have available to us because if we bring in people from abroad to take up jobs then we don't fix problems with the unemployed and poverty or the businesses can leave the UK and damage the economy forcing an ever greater burden on those that remain. The problem is that it will create a dominoes effect and the moment one company leaves then others will follow soon after.

    The government needs to start focusing on proper sustainability of both our economy and our society and in order to do that they need to change the perceptions of people, encourage people to follow different paths and gain a diverse set of skills while incentivising businesses to make decisions that can aid our country and its work force instead of potentially causing severe long lasting economic damage through businesses deciding that the UK is no longer the place to be.

  • Comment number 47.

    The moderation is slow, so forgive me if this has been mentioned before.

    We're not talking about subcontracting jobs overseas; we're talking about importing people from abroad. For someone to move from abroad to a foreign country, with a different cost of living, customs etc, takes a relativelt sophisticated individual. I doubt whether they would accept a low recompensation.

    I could be wrong of course, but I think there are many sides to this story.

  • Comment number 48.

    Businesses are just that, they are in the business of making money. Its the individual and the governments responsibility to see that the UK remains competitive in terms of its people and create a favourable environment for investment, or else businesses will go elsewhere.

    As to highly skilled non eu workers such as engineers etc and other professions on the skills shortage list, employers would rather hire UK workers because there is less hassle in it, but if they cant find the skills they should be allowed to recruit overseas. People in the UK should look at the skills shortage list to see where opportunities are instead of expecting the gov to do everything, using this list schools should be encouraging youngsters to study for these skills, but its going to take many years to get to the same levels, companies dont want to wait and why should they?

  • Comment number 49.

    I'm afraid this all points to weaknesses in our system of education and training - if we assume that the overall purpose of Government policy is to look after the interests of the British people (who after all are the people who keep Governments in power (or not)) and not just create an environment for international business to move freely in and out.

    Relaxing controls on key skilled jobs can only be a short-term answer. In the longer term we clearly need to look at the quality of secondary and university education, to ensure that we have sufficient people who are adequately literate, numerate, creative and with the right work ethic (i.e. it's not just what you can get or what you can get away with), so we can (continue to) have a strong culture of business generated from within the UK.

  • Comment number 50.

    Yes, a cap on immigration will most likely slow short term growth, but how about you paint a fuller picture of the alternative: no investment in building the UK's human capital because it will always be cheaper to import foreign skills rather than train young people; another generation of youth making the rational decision that a life on benefits is their best option; an eroded corporate tax base as the UK develops into a low-skill environment. All of which leads to a ballooning bill for state benefits, a lower tax take, and a bankrupt UK. There is no long-term economic argument for open immigration which doesn't assume elimination the UK's current level of welfare spending and drastically increased inequality to third-world levels. To argue that capping immigration will decrease growth in the short-run, without examining the longer-term consequences is completely dishonest.

  • Comment number 51.

    Robert Peston and Vince Cable have fundamentally not grasped this issue. As a senior manager in a large multinational company I would agree that there are instances where highly specialist skills are not available in the UK, but these are small in number. The oft quoted examples are heart transplant specialists and nuclear industry skills. However, the broader issue is that multinational companies for which I can vouch have sought to outsource whole swathes of their operations and especially IT to companies such as Satyam, Wipro, Infosys and IBM India. These are not skills shortages - bluntly these are skills that exist in the UK labour market, but have drifted away from the industry in the face of an onslaught of low cost labour (and we're talking a tenth of the cost, and in many instances I suspect they are being paid less than the national minimum wage) that floods in under the UK's working visa program. One only has to travel to some of Britain's largest office parks such as Stockley Park to see this in evidence: busloads of workers from the Indian sub-continent living in sub-standard housing, lugging their laptops and their Tupperware lunch boxes, unable to afforrd a meal in the canteen. This is a national disgrace that simply would not be and isn't allowed in countries like France, Germany, Spain and Italy (and in part the pre-dominance of the English language fosters and facilitates this). As long as we allow companies to import cheap labour on a grand scale, we shall always have this skills shortage. It is a self-fulfilling, self-defeating cycle.

  • Comment number 52.

    One thing that your "Grandee" failed to mention is the rampant ageism that UK Employers operate. Perhaps if they started employing people who are past the great Four-O, they wouldn't have such a problem.

    I qualified on the latest version of a very technical software system some years ago. I've got all the certificates, training, required experience, everything in short that an employer normally looks for.

    Didn't even go to interview when I tried the job market.

    You would have thought that at least, with the experience & qualifications I had, you would progress to be interviewed.

    But no. I'd passed the required age to be part of a "young dynamic team' that all employers seem to want these days. Not even a chance to put my case at interview as my CV went straight to the discard pile when they saw my date of birth.

    After a year of this, I gave up.

    So much for the £150,000 invested in training me !

    My qualification is still a "very desirable" & "under resourced" skill today, just as it was then, but I'm past the age where my CV even gets looked at. Skill shortage ?

    I'm just one "skilled" person that won't even be asked to fill a "skills gap". There are many more out there like me.

    Perhaps your "Grandee" ought to look at advertising for an "old, pre-trained, dynamic team" in the UK and then maybe there wouldn't be such a "skills shortage" !

  • Comment number 53.

    I am absolutely certain that there are non-EU workers in the UK doing work that unemployed British citizens are sufficiently skilled for, and at rates of pay Brits are prepared to accept (including myself). This has to be wrong.

    UK businesses just don't want to pay for training, don't want staff over 40, don't want to treat their staff as people rather than commodities; and yet they cry 'skills shortage' just to drive costs down.

    Mr Peston's manufacturing contact should be ashamed of himself.

  • Comment number 54.

    Suggesting the pool of talent is not there is big corporation speak for saying we can get a much lower cost base outside the UK but we need to justify this to our consumers in political rather than greed based terminology. As a small manufacturer in the UK exporting 80% of our production I am very happy with the resources, talents and personnel I have available to me so whats Mr. Bigs problem? BTW the US, where we have a subsidiary, is a hopeless place to find managerial talent.

  • Comment number 55.

    26. At 09:52am on 17 Sep 2010, Justin150 wrote:
    ... As for software development, ICT in schools does not even teach programming. All ICT prepares schoolkids for is being able to work the word processor...
    Too true, I was horrified on visiting my daughter's prospective school to find that this was the case.

  • Comment number 56.

    I work in research and here the cap is viewed as totally insane. I think people renewing their contract have to come out of the cap too, so the end quota of overseas employees is pretty much zero.

    We put up a job advert for around 4 new staff members (needed urgently to do a highly skilled and demanding job in the next few weeks) and 3/4 of the responses had to be binned due to the cap. We ended up with a handfull of non-EU folks we can employ on a temporary basis (graduate students still on a temporary visa) and 1 or 2 EU/UK candidates. So it's now a worry as to whether we can actually get enough good people to do the job properly.

    Certainly no case of paying non-EU folks any less in this instance and as they move their families over here, they spend their salaries here too.
    We also educate/train and there's lots of capable UK talent, they just already happen to have jobs elsewhere (good guys get snapped up very quickly in our field).

  • Comment number 57.

    Multi-national companies have group structures with teams responsible for markets such as USA, South America, India, China, Africa, etc operating out of a head office as well as local businesses. If the head office is in the UK these companies develop their talented staff by bringing foreign nationals to the UK head office and sending UK staff to foreign markets.
    Talanted foreign nationals win because they gain head office experience, talented Brits win because they gain invaluable business experience, multi-nationals win because their leaders have a better understanding of the business and they can offer their most talented staff different challanges thereby improving staff retention. The economy wins because talented staff coming to the UK are given ex-pat contracts which add more to the UK economy than UK residents would.
    The cap endangers this, the development of talented staff is of such importance to multi-nationals they will simply relocate their head office to a country that does not cap foreign workers with a large loss to UK PLC.

  • Comment number 58.

    Mr Peston,

    A quick note of thanks on the volume and range of your blog postings recently. Although the discussions in the comments section tend to head towards familiar ground each time ('we're in a revolution' vs 'we're not' ¦ ' capitalism can never work' vs 'what does?', at least the starting point changes.

  • Comment number 59.

    the constant quick-fix of overseas workers is destroying our childrens futures.

    Where does it make sense to employ 5000+ overseas workers and take on approx 5 local apprentices?

    Oh, in the UK, so that's alright.................................

  • Comment number 60.

    Typical of a modern big company. They have forgotten how to invest in their own staff by training them up to do the jobs they might need in the future.

    The solution is in their own hands - start a decent training scheme within your own company and reward people appropriately. Show a bit of loyalty and thought for your staff - and they will give you what you need.

  • Comment number 61.

    14. At 09:19am on 17 Sep 2010, Bim Sherman wrote:

    I've just spoken to an old colleague to see how she is getting on. She's been on the dole for about a year now. Everywhere she tries she's told how excpetional she is (and she is) but that she is too experienced and too qualified!

    The last government sent her to a company to help her find a job. They shook their heads and told her there was no way she'd get a job because she was too exceptional and just not what the few employers in her city were looking for! The new government wisely stopped the help to save money! Next year, I think they'll just starve her!

    Re my previous comment.

    On that same radio show there was a manufacturer from the north of england on. He was ranting about not being able to get trained workers to operate his machines on his production line. He was upset because he expected the government to train people to use his machines! He was whinging that the government were being tight-fisted because it was basic work and wouldn't cost the government much to train the people he needed!

    What kind of muppet does it take to run a business! It's a production line, for crying out loud. It takes a week or two to train someone to pull levers. My first job was in a factory. Straight from school. Not a penny from the government and within two weeks I was a fully productive machinist!

    From the rest of the posts I've read here, it seems the British are utterly fed up with the shyster demands of employers in the UK and the game businesses have played for years.

    About time too. Take a bow and round of applause.

  • Comment number 62.

    "largest manufacturing exporters last night"

    - what does he manufacture ? As far as I know the only things we still export are health professionals (to the US) and armaments.

  • Comment number 63.

    This pathetic complaints by the “grandees” are all because of the tragic short-term cost-focussed outlook by those who control British industry. Instead of investing in people and investing in capital, British employers have always gone for the cheapest and worst option - importing cheap unskilled workers from overseas. Over the decades, this has severely damaged the ability of British industry to compete on a world wide scale, not to mention the untold and continuing damage to fabric of society. To profit long term, British employers would do well to copy other developed and emerging economies training their British workforce to world class standards required to prosper in the highly-competitive 21st century global market place.

  • Comment number 64.

    Actually, the Businesses are somewhat right in saying that they are restricted by the cap in immigration. What we fail to look at is the ability of the business to grow at the near future and at the same time invest in local skills as a long term proposition. Businesses can’t wait for their local talent pool to grow and then start gaining from their productivity. If they do, they won’t stay in Business, which is a counter loss to our economy. We all start accusing of cheap labour/skill/products/services from India and China, but can we survive without them feeding our want and our life style. We simply can’t, we need businesses to operate in the way they can run a productive and viable service to us all. Are you going to be happy to pay to own a debit card, open a bank a/c, maintain a said minimum balance in our current a/c, pay for customer service, pay 3 times more for a product that can be bought at a much lower cost with the same quality etc.....we are so used of these services and we let these job off our kit long time ago. The developing nations have picked them up and that is the hard truth, whether we like it or not.
    You won’t have highly skilled workforce if we are not too keen towards education. Education does not end by just going to starts there. Training is key, but u can’t get away just by getting trained. Anyway, coming back to the point, we need Business to do what they have to do to keep the economy going (if that means hiring people from overseas, so be it) and at the same time, invest in local talent. It will take yrs and even decades but we will get there.

  • Comment number 65.

    How many times do we have to have this same debate when we already know the answers? We know that these companies want cheap labour. We know that, for example, some Indian companies just want to employ Indian workers in the UK, especially in programming. Quite frankly the line that workers in the UK aren't good is simply racist. If the BBC continues to report in this way without requiring proof of the assertion from its sources then I and many others should hold it up on a charge of racism directed at the very people who pay for it.

  • Comment number 66.

    30. At 09:57am on 17 Sep 2010, ronnie wrote:

    That's a real shame. Offer to rent it back in 6months for £250 less than what you are paying right now. Who is going to start up a business or expand into new premises under this economic climate. We need to see these "professional landlords" default or offload their portfolios to get some sense back into the property market.

  • Comment number 67.

    5. At 09:06am on 17 Sep 2010, flicks2 wrote:
    Is Keen right then?
    I'm reposting this from the comment I left last night.

    Is this part of the New Capitalism you spoke of previously.
    Just to remind us all Vince said people would be angry. We are even more so now!
    And Davey Boy was concerned about ethics and well being! Through people out of work and then whinge about couch potatoes!
    So will these changes be ethical, fairer and improve our well-being?

    Or are we really facing the reality of our delusional economic model:
    Prof Steve Keen -

  • Comment number 68.

    5. At 09:06am on 17 Sep 2010, flicks2 wrote:

    "Now this is a juicy one !

    To the unions and their graph geek advisers please take note :-"

    Superb! - at last we can see the lengths this Government will go to in order to prop up this funny money game.

    My favourite part is the Japanese who now hold just $25bn short of china in the treasury holdings stakes - so they intervene, sell JPY, and buy treasuries with printed money.

    Now someone please re-explain 'value' to me because it seems the Japanese are simply making it up as they go along!

    Don't worry though - I'm sure this is all 'normal behaviour' and 'someone has it under control' - although they are the same 'someones' who didn't see the credit bubble blowing and bursting - why do we think they'll see this US treasury one doing the same?

  • Comment number 69.

    As a manager of an IT Department I have first hand experiance of the number of non-UK staff apply for IT jobs. There is NOT as shortage of IT skills in the UK, but we have flooded with less costly labour from abroad. This has de-valued the profession and people have left the IT industry due to the wages being driven down to less than a office junior in a bank.

    There is little chance of verifying the claims on a CV of people from other countries so are we really helping or just providing a short term sticking plaster to the rot that is UK businesses not training their staff.

    Remeber that if you employ UK people they will not send "money back home" but will spend more in the UK.

  • Comment number 70.

    We don't have these people because companies don't want to spent the time and money training them.

    They want cheap labour from overseas, trained cheap and cheap to employ.
    Once their contract is over, they are ejected from the UK.

    Britain used to have an apprenticeship system, re-investing in itself but current governments, both labour and tory believe in this system of de-skilling the entire country.

  • Comment number 71.

    One litle snippet:
    My eldest is starting his GCSEs. He choose a new business diploma course, which is an excellent attempt at getting practically taught students with great industry links.

    However 2 weeks in, he's having doubts, becuase his peers doing GCSE's are laughing at him, becuase he's doing a "thicko" course.

    So even at the age of 14, our kids are being discouraged to take practical courses with industry backing, rather than taking regular GCSE's which are aimed at getting a very different type of student.

    This country's mindsets are all wrong.

  • Comment number 72.

    Absolutely disgusting comment.

    As a Liberal voter we didnt want a hard core tory party that would prefer to keep 2.5 Million people on benefits


    As luck would have it, I bumped into the boss of one of our largest manufacturing exporters last night, who complained that his ability to expand in the UK was being seriously hampered by the new restrictions on his ability to hire from outside the European Union, that have been imposed by the coalition government.

  • Comment number 73.

    22. At 09:47am on 17 Sep 2010, PGUK

    Been there done that! At one point in my life I had a government official tell me to lie about having a PhD because it was a barrier to employment! Bosses don't like it when you are smarter than them. And science is even more scary, because that takes intelligence along with skill, planning, creativity, tenacity etc etc.

    And they know scientists don't like bending the facts to suit the marketing...

  • Comment number 74.

    Stop all benefits. Pay every adult on the voter roll 10,000 a year. Those who work are then paid and taxed on everything they earn. Companies with non-EU workers pay double tax on their profits.

    Or something similar...

  • Comment number 75.

    This is astounding. at a time of rising unemployment in the UK..we want to bring more people from abroad. Highly skilled work such as IT are being off shored to India and largely due to this and the economic downturn British IT professionals in State owned banks such as RBS are being made redundant, but Vince Cable wants more people to come into the UK to fill this phantom skill shortage.
    The one and only reason that business want foreign workers is that they are cheap, and companies do not want to train British staff, this will only lead to a long term decline of UK.

  • Comment number 76.

    36. At 10:03am on 17 Sep 2010, fairlopian_tubester1

    I bet there will be a massive cut in the number of PhD places in the UK from now on.

    Once you have a PhD, you might as well have the plague (a business consultant from one of our universities told me that as he explained he spends ours talking people out of taking the PhD places they are considering).

    That and the massive cuts to academic research on the way will finish off a lot of our best exports - our talented people.

  • Comment number 77.

    A nice example of the problem with globalisation and the disconnect between business needs and national interest. Isn't it about time we started saying fine go!

    Whilst businesses are wealth creators, if it's one worker displacing another isn't the net impact that the public purse picks up the cost of that local worker being out of work.

    As others have said, it seems more about money than skills, given the arbitrage that makes this attractive, in a global economy, surely it's only time before some bright spark suggests exporting the displaced local workforce to parts of the globe where it is cheaper to maintain them in more comfort!! - I jest.

    But isn't the real issue simply that the concept of Nation and national legislation are increasingly at odds with a global economy and that this disparity will grow rather than close!

    At present new markets and consumers can be found, but overtime the fight for market share will increase competition. This in turn will lead to cost reductions in salaries etc, so isn't the end game that unless we change from a shareholder to stakeholder mentality, globalisation will lead to poverty rather than prosperity for the majority?

  • Comment number 78.

    Did you ask this paragon of industry why he believes such skills are not being developed in the UK/EU? What training programmes are in place in his organisation to replace the overseas workers within a reasonable timeframe. Like most of the other posters, my suspicion is that a) he just doesn't want to employ UK workers at UK wage levels, and b) he therefore has no plans to replace migrant workers with UK/EU workers.
    To counter this short-termism, the governement should encourage 'good' behaviour by tilting the table - ok, allow essential migrant workers into the UK but insist on a contribution to the training of UK/EU replacements. The easiest way to do this would be with a wage levy of say 20% which could be directed to universities or other training providers. 20% doesn't seem unreasonable for "essential" skills!

  • Comment number 79.

    Will these restrictions also be applied to football, rugby, cricket and so on? We will soon hear the screaming from the media and other interest groups if they do. If it's good enough for the Premier League (and specifically Arsenal, Mr. Peston) to sustain its self-proclaimed status of "best league in the world" by importing the best talent it can afford from around the globe, why is it wrong for the UK's other employers not to do the same? Isn't that anti-competitive?

    If Messrs. Cameron and Osborne are sincere in their concern (and I believe they are), why can't they devise a scheme which enables the short term demand to be met, but provides incentives/penalties to create longer term solutions? That said, if future supply will depend on a broad and deep pool of well-educated people, and if the education system will suffer short to medium term cuts, how do we square that circle? After all, education is under political, not commercial control...

  • Comment number 80.

    "However, my manufacturer says that the pool of highly skilled people just isn't wide enough or deep enough in the UK. And in recent weeks I have heard identical comments from bankers, software designers, drug makers and so on." Wow. The one that caught my eye was "drug makers". For those of you who don't follow the industry there have been 3 major research site closures in the last 12 months (GSK, AZ and Merck). Once GSK and AZ merge that'll be another one gone and we'll have 1 major site and a few medium sized one. There is no VC market to allow start-ups to swallow the massive pool of talent available and vast swathes of people have simply left the industry altogether. So, Robert, you can quietly laugh at ANY pharma CEO that says there is a skills shortage in the UK. There isn't. I'm all for allowing free immigration and the current glut of jobless scientists doesn't mean I favour keeping people from outside the EU out. They simply won't come as there are no jobs for them.

  • Comment number 81.

    I word of warning for those who support the immigrant worker cap on the basis that it will 'create jobs' in this country.

    The probem is we're not isolated, and worse we're actually one of the biggest exporters of labour in the world.

    What are all the emmigrants going to do when the nations they reside in decide to enact a cap of their own?

    The situation would appear to be worse - as the 'new immigrants' would in fact be 'ex-emmigrants' returning home to find work. This will not be condusive to a recovery - especially as it's more difficult to exploit an ex-emmigrant than an immigrant and therefore you can't pay them lower wages (as the businesses who are collapsing are desperate to do).

    This is all because no-one is facing up to the fact that we're well over capacity in this country - thanks to the exploits of banks - and that there are simply not enought jobs to go around. This also has the effect of reducing custom for businesses - who's only hope of survival is to cut costs. Fixed costs cannot be cut easily - so it's variable (labour) costs which are reduced in order to 'produce profit' - a bit like the banks who one day announce 3,000 redundancies and the next as reporting a profit during a time when sales are falling.

    You see you can play economic fantasy all day - but eventually economic reality catches up with you.

    The profits you see are made from cuts to costs - not due to growth of sales. That is why they will soon start diminishing again - a view echoed by the retail sector this week.

  • Comment number 82.

    Hey here is a new idea why don't they train UK workers in the skills which we are lacking or only do University degrees that fit the skills gaps? Novelle idea?

  • Comment number 83.

    I completely agree with EmKay, this is only an opportunity to poach skills from third world countries at the expense of our talented youngsters.This is driven by greed and will not solve our employment problems only make them worse. Vince Cable is misguided.

  • Comment number 84.

    A very interesting article and not an unexpected outcome. There is a general misunderstanding about what constitutes talent. Most organisations and commentators equate talent with competence and experience. Talent is really about the capacity for thinking and taking action that we use to channel our competences. Competence can be acquired but by the time we reach adult maturity, the approach we take to thinking and taking action is (largely)established and we become operational, tactical or strategic thinkers. Business in Britain and elsewhere fails to recognise how difficult it is to move effectively between the different approaches and therefore promotes based on experience rather than capacity. RBS is an example of this.

  • Comment number 85.

    Some people posting here seem to think we should be investing in home grown talen.
    There are obvious time constraints on this it takes a minimum of three years to train an apprentice and for someone to obtain a degree.

    The problem in the middle skills range is the way apprenticeships are funded. A large number of small employers seem to start an apprentice every 2 years, The reason for this is that they are subsidised for the full cost of the apprenticeship for the 1st and 2nd year. When the apprentice finishes their NVQ2 they are suddenly not good enough and end up in the Jobcentre.
    Is there a correlation between the fact the employer needs to find the wages and the fact that the Careers office will snap up their offer to take on a new trainee?

  • Comment number 86.


    I just looked up "spiv" to clarify the meaning for myself. It seems to be a petty con-artist, without employment and generally without a residence.

    I'm not sure the people you're calling spivs really fit the description. Is the wrongdoing 'petty'? Are they wandering con-artists? I submit that they are not.

    Please don't mistake my point as a defence of anyone. I merely love words and think spiv is a great and specific word. Perhaps there is a better word, of maybe we can coin one here?

  • Comment number 87.

    If this is the person I think it is, then you need to ask him why he only wants to recruit people from India when there are so many fully qualified, experienced people out of work in the UK.

    Is it racism?

    Or is it because he is dependent on bringing people over from India, having ten of them live in one house and paying them low wages?

    The ConDem master plan is that the 'private sector' is going to expand to take up the people this government is going to deliberately put out of work. As you say, clearly even more ridiculous if even the new jobs produced in England are going to be filled by foreigners.

  • Comment number 88.

    So ask a director why he is so highly paid and its all about attracting the talent required to do the job.
    But when its somebody who actualy does the work the same directors dont see higher wages as a solution to attracting tallent.

    Strange that!

  • Comment number 89.

    Yes, Robert.....

    As per the comments above, I think we can all see through the winge of your captain of industry friend - that it's nothing to do with skill shortage - simply increasing unit wage costs.

    OK so he's a big exporter, and we all want to support that (....although maybe it's armaments?).

    But one can't help thinking it's the bleat of a capital owner who, after forty years of declining unit labour costs, is for the first time in living memory facing an increase.

    Call him up and tell him it's bit pathetic really, in that within the last few years he's benefited from a reduction of what, around 30% in the value of the pound.... And he's still complaining!?
    He's behaving like a complete farmer for heavens sake!
    Next thing you'll know he'll be wanting a subsidy.....

  • Comment number 90.

    I think there's a large amount of agreement on this post (and on others befor it) that successive governments are not running the country for the benefit of the average person on the street (or taxpayer).

    So rather than just talk about it we need to organise and change things.

    Any ideas?

  • Comment number 91.

    But I keep being told that Britain's Got Talent.......

  • Comment number 92.

    As usual, with the subject of non-EU migration we have a lot of people with very little information throwing comments about. Firstly, the Home Office only allows highly skilled migrants and where there is a specific job that cannot be filled locally to be eligible for a visa. It is this pool where the limit has been imposed, which I agree is silly.

    I encourage everyone to go onto the Borders Agency website and see for themselves the requirements. Put simply, to be 'highly skilled' you realistically need to be currently earning at least £30k and have a Masters level degree - which totally takes out the possibility of your 'cheap labour from India'. The other skilled category only enables work in one specific job-employer and again has stringent requirements and caveat that you need to fill a job that cannot be locally filled.

  • Comment number 93.

    #24: You are perfectly right. I remember all the fuss German chancellor Schroeder made about his green card, intended to attract Indian IT experts. The program was rather a failure, though, since salary and working conditions in Germany didn't attract any Indians. The buying power of the salaries offered and the social status were not competitive as compared to those in India.

    Therefore the most immediate consequence from a business point of view is outsourcing, and that has already happened on a massive scale. So why does that anonymous business leader talk about hiring non-EU citizens in the UK? Does he really mean it? Isn't it going to be the same result as it was in Germany?

    Possibly the intention is rather to keep pressure high on british work force to accept lower wages and to do training on their own expense. Or it is intended to keep pressure high on the government to accept responsibility for work force training, so the companies needn't do it themselves. Government funded training (in all the indebted EU countries) is otherwise likely to be reduced with budget cuts.

  • Comment number 94.


    I'm afraid that I had to take you to task here. You and Vince Cable are completely wrong when you suggest that there isn't a suitable pool of talent within the UK or even the European Union.

    I speak from personal experience as somebody who having worked for a large UK bank for over six years before being made redundant last November. My last 12 months were distinctly unpleasant. I watched entire departments being dismantled so that Indian contractors could be brought in to perform the tasks previously done by my UK colleagues.

    Whilst I met a small number of highly skilled offshore workers and spoke by telephone to some extremely capable Indian IT specialists, the vast majority were considerably less able than their UK counterparts. The primary reason that they were being brought in was to provide extremely low cost "bodies" to replace experienced UK workers. The London-based workers were all housed in overcrowded rental accommodation which gave them little incentive to leave the office, many of them preferred to stay at work for 12 hours per day or more. Some managers equate "being in the office" with "being productive", sadly this isn't the case.

    My colleagues who were being made redundant faced the indignity of having to train their replacements. One of my colleagues was asked to write his job description so that our off-shore partner could provide an estimate of the number of people required to perform the same function. When the estimate was returned our partner suggested that five offshore workers would be needed to perform his duties.

    Managers are well aware of the fact that the offshore teams are often less efficient, difficult to manage and error prone. This is overlooked because there is a desire to reduce "headcount" and please "the city". The reduction in the number of permanent UK-based employees is popular with large shareholders since it reduces the long term pension problem and headline operating costs.

    What is hidden from customers and shareholders alike, is the incredible risks taken by the banks and other organisations who are using low-cost resources with little "real-world" experience.

    I'm happy to have left my former employer and manage to "escape" with my redundancy money and good employment prospects. I feel deeply sorry for my colleagues who weren't so fortunate and are forced to "grin and bear it" as they watch the company that we all love tear itself apart. The desire to increase the number of migrant workers is blatant short-termism and it is the obsession with short term share price movements that is destroying British business.

  • Comment number 95.

    A company that I work for recently announced redundancie however, what is actually happening is that uk contractors are being phased out in preference to Indian contractors. So after bailing the banks out, the very taxpayers who are expected to pay for it must endure (a lower salary at best, or dole at the worst) while the money used in the bailout flows abroad.

    The mind boggles at just how POOR this government are, they are utterly clueless at won't last beyond next June (A prediction of mine) And I'm no fan of Labour!

  • Comment number 96.

    26. At 09:52am on 17 Sep 2010, Justin150 wrote:

    "Nice to see that the critics of globalisation are out in force early this morning.

    It is of course utterly disgraceful that India and China turn out so many well qualified graduates. How dare they work for a wage that, in their country is good, but for the UK would be below minimum acceptable levels. Indeed how dare those countries try to improve their economic lot."

    Why not offer them the same renumeration as a native from the EU then, if it is all about 'imrpoving their economic lot'?

    "The complaints are about lack of skills not salary levels."

    Don't be so naive!

    "In other industries the complaints are also about commitment to work. For example in many parts of the country most of the jobbing builders are Polish and Brits looking for simple repair jobs are happy to hire them. Is it because the Poles are a lot cheaper or because they turn up every day just before 8am and do a full days hard work to get the job finished on time and at least within spitting distance of the original estimate (they are builders so they will rarely if ever actually only bill the original estimate !) as opposed to turning up some time after 9 am with the cheery starting comment of "sorry gov, traffic" and then spent the next 30-40 mins making tea."

    If the Poles are so great and it's not about money - why are employers looking outside the EU?

    Do you understand the contradictions in your own post?

    The transfer of wealth from west to east is unstoppable now - just don't expect the west to go down without a fight.

  • Comment number 97.

    Business at any sort of high turnover is all about lower costs to win contracts (at a correspondingly lower price). Differentiation is most often by price to the utter frustration of those who genuinely offer a better product/service.

    Lower costs tend not to increase profits long term, often all they do is prop up poorly managed companies run by single trick (low wage) managers.

    As a percentage the number of genuinely excellent MDs is low. The others have their jobs due to inertia (and someone has to do it).

  • Comment number 98.

    Well, on the whole I would rather recruit from overseas, or at least have the opportunity to do so.

    The UK doesn't produce enough graduates that are smart enough, have the right kind of appetite for business and don't mind getting their hands dirty (both literally and metaphorically).

    We have had good experience in past years of recruiting science/engineering graduates from the Far East, and not for reasons of cost, as has been alluded to by other contributors. We pay all graduates the same, no matter where they come from.

    Those from countries such as India or the Philippines (some with a postgraduate degree from a UK university) typically outperform the domestic UK graduates/postgraduates we have take on, and rather quickly too. It's hard to say whether this is down to better educational standards from school onwards or just the degree of enthusiasm they take in becoming competent, or more than competent, in what we ask them to do. If I had to choose, I would pick the latter reason: pure and simple appetite for hard work and meeting customers' needs.

    We have good UK graduates too of course, but even the best of them can have unreasonable expectations at times, for example in expecting promotion or salary increases before these have been earned or are justified. Many of our UK graduates are softies compared with their foreign colleagues.

    We have never had this problem with those from abroad, some of whom are capable of being promoted, and are, to rather senior and demanding technical roles in just two or three years.

  • Comment number 99.

    Dear Robert
    This really is a situation where you must reveal your sources. We must know which masters of the universe are bleating about access to the labour pool.Specify exactly which jobs, which companies, their track record on investment and their head honcho pay structure. It never ceases to amaze me that when these captains of industry relocate abroad for "cheaper labour costs", they can never at the same time find more economical chairmen, chief execs, directors etc who do not require bonuses,golden parachutes, London clubs,relocation expenses, obscene pension funds... strange?
    What's that? They must always keep a head office presence here... how fortunate for their gold plated snouts.

  • Comment number 100.

    Interesting points however everyone seems to be missing the point. Manufacturing was destroyed by the Conservatives and subsequent labour goverments.

    Labour, the Greedy Bankers and the parties in opposition allowedthis country to increase its borrowing to what can now only be described as "Bankrupt" levels by allowing amogst other things, payments to overseas workers to come to this country and benefit from our welfare system.

    The manufacturing capability in the country. No skills but you are okay if you have a degree on the contestants of Big Brother as that sort of education is well worth it.

    However there is an upside. with the imposed welfare cuts which are already taking place and I have first hand experince we will soon be able to cope with british worker recieveing no more than £18.00 per week as I can confirm that my benefits have been cut by 40% as of the 1st October 2010.

    Oh did I mention my wife and our three children I have to support!

    So we can now compete in terms of poverty and low wages just like a third world country as we must ensure the bankers and incompetant MP's and the governer of the Bank of England all have safe jobs with high salaries.



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