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Why innovation needs immigration

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Pawel Cebula is co-founder and COO of  Medigo, a company that has hired staff from 28 different countries. In this article, he discusses why tech companies need to be able to hire talent from outside of the UK. 

In the wake of the European refugee crisis and ahead of the June referendum on a potential Brexit, immigration remains a hotly contested topic.

A recent Ipsos MORI poll found that concerns about immigration top the list of the most important issues facing Britain, with just under half (46%) mentioning this issue.

But amid the concerns, there are many benefits that immigration can bring, particularly to the European tech scene.

SME-led growth

Across the EU, economic growth is being driven by SMEs.

These SMEs currently represent 99% of all businesses in the EU, creating around 85% of new jobs and providing two-thirds of the total private sector employment in the EU across the past five years.

SMEs and startups owned by foreigners create on average four jobs during their first years of existence (3.8 jobs in France, 3.6 employees for Germany, 5 in the UK) versus 1 job across all types of companies.

According to figures from the Organisation for Economic Co-operation and Development (OECD), immigrants in many OECD countries exhibit higher rates of self-employment than their native counterparts, creating the very SMEs that fuel new jobs.

Leading tech innovation

No-where is this more apparent than in the tech industry. Many industry giants such as Intel, Google, Apple and eBay, were founded by immigrants.

Immigrants are typically young and eager to work, are more likely to found their own business and, bringing with them complementary skills, ideas and connections, they tend to contribute to increased economic growth, boosting the job market and earning potential of immigrants and natives alike.

Among the UK tech scene, immigration is an issue that resonates particularly strongly.

Though the digital tech economy is creating highly paid opportunities across the UK, the recent Tech Nation report showed that a large proportion of tech businesses in the UK see the ‘limited talent supply’ as one of the key challenges they face.

Access to talent

The report showed that 19.3% of the UK’s digital tech businesses source talent from the EU and 15.6% from non-EU countries.

Indeed, one of the main fears is the adverse impact a Brexit would have on the ability to recruit and retain tech talent from within the EU.

Tech businesses (especially those in London) have benefitted from the free movement of workers and the concern is that if this ends it would negatively affect the ability of UK tech and digital businesses to access developers and engineers with the right skill sets from abroad.

Moreover, tech companies could soon be forced to pay £1,000-a-year for every skilled worker they hire from outside the European Union, after the Prime Minister David Cameron announced measures to reduce the number of immigrants entering the UK through the Tier 2 visa route, which allowed 151,000 skilled immigrants and their dependents to enter the UK in 2014.

These measures were challenged by a group of top entrepreneurs in October 2015, who argued that: “The UK has become a global tech hub thanks in large part to startup founders, investors and employees from across the globe, including many of us who were not born in Britain but choose to invest our time and talents here. We are very concerned that changes to immigration policy will make it more difficult to attract and recruit the talent high-growth companies need to compete and succeed in a global marketplace”.

UK scepticism

As London’s international success in the tech startup scene shows, immigration is an asset to business.

It’s time to recognise that while immigration is a sensitive subject, culturally and economically it can bring many benefits and advantages.

For any global business, access to talented, international staff is extremely important and can only be achieved in cities that are truly multicultural.

In short, immigrants do have a lot they can and want to contribute. Far from “taking jobs” they very often create them.

And that can only be a benefit for all.

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