Migrants’ skilled worker visa applications plummeted in December, posing a test to Rachel Reeves and economists at the Office for Budget Responsibility (OBR) to take control of public finances.
New figures showed that the number of skilled worker visa applications dropped to 2,500 in December, having increased to a peak of 10,100 in April 2024.
The number of applicants have been gradually falling over the course of the Labour government’s time in Downing Street, with a low of 2,000 having been recorded in November.
There were roughly 6,000 applications being made for the visa in the year up to the General Election in 2024.
This has come after a string of changes led by home secretary Shabana Mahmood tightened criteria on visa application as she is charged with reducing immigration levels to ease voter concerns and support British workers.
The salary threshold rose to £41,700 in the middle of last year while proposed changes could see the time period to gain settled status to be doubled to ten years for most workers who can prove they are not dependent on state welfare.
Health care worker visas have also radically dropped to 900 ahead of its official abolition, having reached a peak of 18,300 previously.
Student applications, particularly for dependants, are also much smaller than figures recorded in previous years.
Meanwhile, business chiefs have raised the alarm on a possible “brain drain” due to high levels of emigration among younger workers under the age of 45.
The Office for National Statistics (ONS) said three quarters of 232,000 British nationals leaving the country in the year to June 2025 were 25 to 44-year-olds, while pensioners made up a fractional portion of emigration.
Lower number of migrants ‘to hit growth’
Warwick University’s James Bowes has suggested net migration could near come down to as much as 50,000 in the year to June 2026, bringing some political figures’ hopes of seeing net zero migration come to fruition.
Economists have sent warnings to Rachel Reeves that the rapid decline in net migration could harm public finances.
The OBR did not take an assessment on the government’s immigration policies given they are subject to change. It forecast net migration of 262,000 for the year to mid-2026 before rising again to 340,000 by 2030.
The left-leaning Resolution Foundation suggested that negative net migration could take £20bn off the government’s budget by 2030, according to The Times, leaving Reeves with a hole to fill with spending cuts or tax rises.
The National Institute of Economic and Social Research’s Stephen Millard said new visa criteria could damage UK growth prospects, hitting hospitality businesses more than others.
Other researchers, including Tory policy chief Neil O’Brien, have pointed to some migrants’ dependency on the state and the possible savings the government could make to the welfare bill and other benefits offered over the course of people’s lifetimes.
