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Report: One in four UK businesses hiring overseas to tackle talent shortage

UK overseas hires still lag behind global numbers but increased diversity, interest in markets, and tech talent all lead businesses to look outside London

A quarter of UK businesses have turned to hiring global tech talent in a bid to overcome domestic skills shortages, according to new research.

Overall, 27% of UK businesses have already hired candidates from overseas, or are in the process of doing so, while 63% still focus primarily on UK-wide recruitment drives.

This compares to a larger figure of 36% amongst global decision-makers, indicating that despite the UK’s continued shortage of skilled workers, businesses continue to look inward for new hires.

Amongst those taking part in global talent acquisition, skills shortages motivated 25% to do so, but were not the primary reason behind the practice. This was identified as a desire to diversify teams (67%), while an interest in testing new markets was a motivator for 60% of respondents.   

Results also indicated that while UK businesses are looking overseas, the majority (70%) of firms favour existing tech hubs like New York, Paris, and Berlin over emerging tech talent hubs like Ahmedabad, Budapest, or Mexico City. 

This illustrates a disparity between hiring decisions and the potential talent pools in these emerging markets. In Gartner’s ‘Emerging IT Talent Hubs in 2022’ (PDF) report, existing and emerging tech hubs were each assigned a ‘supply-demand ratio’, calculated as talent supply divided by talent demand.

The higher the number calculated, the more untapped talent the hub was determined to hold. London and New York York were awarded 2 overall, versus a score of 8 for the top emerging tech hub Mexico City.

However, just 7% of respondents in Remote’s study indicated that they considered Mexico City to have ‘considerable talent’, compared to 20% who indicated that they still believe there to be such talent in London, and are continuing to seek candidates within the city.

HR solutions company Remote revealed the results in its 2022 Tech Talent Report, which showed the skills shortage is having an effect on the hiring decisions of decision-makers within the sector.

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Beyond the benefits of flexible working, hiring managers are also factoring in the ethical implications of remote work from emerging tech hubs. 68% of respondents who indicated that they were considering hiring from a global pool said that it was important to allow workers to progress in their field without having to move country.

“When I think about the colossal opportunity to hire great talent around the world, the challenges businesses are facing and blockers to hiring the best talent seem small,” said Job van der Voort, CEO and co-founder of Remote.

“The research shows that for businesses to meet their tech talent needs, they need to go a step further and look beyond their own market. Tech talent hasn’t disappeared, it’s just distributed around the world, and companies need to overcome the challenges to access it”. 

Firms looking to increase their international talent pool through remote hires face the challenge of managing a distributed team. 47% of respondents indicated that language barriers were a concern in hiring decisions, and 46% pointed to the difficulty of working across different time zones. 

In response, Remote recommended adopting asynchronous work patterns which allow workers to adjust their shifts to best suit productivity and convenience, and also give those who don’t speak English as their first language time to translate information in work and messages.

In this and a number of other ways, companies could benefit from removing the need for instantaneous responses.

The research was conducted via an online survey in September 2022, with 1,485 decision-makers currently hiring for remote roles in the tech sector taking part. The UK sample consisted of 251 such business leaders across the same period.

Bringing global tech talent to the UK

In 2021's Autumn Budget, the government announced it would overhaul the UK visa system to attract more overseas talent, making several notable changes to the Global Talent Visa (GTV). This was created with the aim of attracting STEM experts to boost the UK’s innovation and diversity of talent in emerging fields such as artificial intelligence (AI).

Changes included the addition of a number of eligibility criteria for the GTV, with particular regard for candidates with research grants, approved international prizes, or an individual fellowship. Applications from such candidates are placed into a faster lane than those without any of these criteria.

The government also offers the Innovator visa, which aims to help those with a specific plan for setting up an innovative business in the UK.

However, unlike the Global Talent Visa, applicants to the Innovator visa must demonstrate a proficiency in English as assessed in an approved test, or through the candidate’s possession of a recognised qualification in English.

There are a number of countries and territories excluded from this requirement, but it can still be a stumbling block for potential applicants.

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