by Nitin Dahad
As time goes on, changes in immigration policy are starting to have an impact on tech hiring and tech talent availability. A recent report on hiring trends suggest the 2016 election in the U.S. and the UK’s Brexit vote will have a negative impact on innovation in these countries as it leads to a loss of tech talent.
According to the ‘Hired’ report on global tech hiring, forty percent of its survey respondents have considered relocating to another location outside the US since the 2016 election. Of those individuals, nearly one third cite Canada as their top choice (32 percent), followed by Germany (12 percent), Asia (10 percent) and Australia (10 percent). Furthermore, it appears as though Brexit has had a negative impact on tech workers’ decision to relocate to the UK. While 6 percent of respondents listed the UK as their top choice if they were to relocate, another 43 percent of respondents said that Brexit had made the UK a less desirable place to live.
In both countries, the need for tech talent remains at an all-time high, and if companies can’t rely on foreign workers to help cover shortfalls in domestic supply, there is likely to be an exacerbation of the skills gap. The report adds that since the VC market is on the upswing after a massive contraction that started in the back half of 2015, this means there could be a severe talent crisis as companies pump more money into hiring.
The report says the United States is slated to face a shortage of more than 1.1 million STEM workers by 2024, an issue that may be further exacerbated by limiting access to foreign technical talent.
Its research revealed a 60 percent decrease in requests from US-based companies to foreign workers from Q2 to Q4 2016, which was likely the result of uncertainty around immigration policies generated by the election. This uncertainty abated to some extent post-election, but in Q2 2017, US interest in foreign workers was still down 37 percent year over year.
Foreign candidates were also slightly more reluctant to engage with US companies, as evidenced by the 4 percent decrease in the rate at which they accepted interview requests from American companies between Q3 and Q4 2016. This rebounded more than twofold in 2017.
Over the long term, these issues could very well have a negative impact on the US’ ability to stay competitive in the global tech economy. This is especially true given efforts by countries like France and Canada to lure tech talent and companies to their soil through more relaxed immigration policies, special visas for entrepreneurs and tech talent, and tax incentives for businesses.
Foreign companies may be trying to capitalize on this sudden interest in working overseas: the percentage of their total interview requests on the Hired platform that have gone to American workers has steadily increased since Q2 2016. Interestingly, however, the rate at which those interview requests were accepted has declined since Q2 2016, with the exception of a small 1 percent increase right around the election in Q4 2016.
For now, US immigration policies are still in flux, so it’s too early to predict just how events will play out. That said, it appears that the conversation around immigration hasn’t impacted foreign candidate interest quite as strongly in the US as it has in the UK. While foreign candidate interest in UK-based companies drop by 20 percent following Brexit, the same stat dropped by just 4 percent in the quarter following the US election, and has since rebounded to figures that are higher than they were pre-election.
Another report earlier this year from Hired also suggested foreign candidate representation in the UK candidate pool is down 50 percent since the Brexit vote, and there were a staggering 60 percent drop in the number of offers to foreign candidates by UK firms in the same period.
What’s clear is that tech talent is vital to the tech industry. Since much of the industry in the US and the UK relies on teams comprising both local and foreign STEM talent, there is likely be a shortage of skills and talent availability unless there are policies that encourage the recruitment of highly skilled workers in some format. Meanwhile, this uncertainty in the US and the UK will give countries like Canada, Germany, Australia and France as well as the Asia region a good opportunity to strengthen their own innovation ecosystems with the world’s best.