UK businesses urged to act fast as immigration reforms clash with industrial strategy

This is part of a broader tightening of the sponsored work regime and comes just days after the release of the UK’s Modern Industrial Strategy.

Businesses may feel concerned by the upcoming changes, but the goal should be to shape what comes next—not to retreat. The Strategy places access to global talent at the heart of national growth. Businesses hold an unprecedented influence to reshape the immigration landscape and must use it.

This prompts a critical question: are the UK’s immigration policies now working against its own industrial ambitions?

What’s Changing?
The Skilled Worker route updates are substantial:

General salary threshold will increase from £38,700 to £41,700
Skills threshold will rise to RQF Level 6 (degree level)
Lower-skilled roles (RQF 3–5) will only be eligible if listed on the new Temporary Shortage List (TSL) or Immigration Salary List (ISL)

The ISL will be phased out and the TSL will offer temporary access to certain mid-skilled roles but with restrictions including no dependants, no salary or fee discounts and an expectation that employers invest in domestic upskilling.

Crucially, these changes will apply to Certificates of Sponsorship (CoS) issued on or after 22 July, giving employers only a narrow window to act under current rules.

Reform vs Strategy
On paper, the Statement of Changes and the Strategy both aim to attract the right talent to drive national growth. However, their operational priorities diverge. The Strategy is forward-looking and growth-driven; the Statement reflects political urgency to reduce net migration.

This contradiction is particularly stark in sectors like care, logistics, construction and advanced manufacturing - sectors labelled “critical” in the Strategy but are now facing higher sponsorship barriers. By limiting access to mid-skilled roles and raising costs, the reforms risk deterring international recruitment amid already acute talent shortages.

How Should Businesses Respond?
In the short term:

Prioritise applications requiring a CoS to be assigned before 22 July

Ensure compliance systems and salary frameworks reflect the new thresholds

In the longer term:

Engage with government

Future visa access will be evidence-led; businesses should gather data on workforce, domestic skills investment, and their role in driving innovation

The immigration landscape is shifting, but the real risk isn’t change - it’s failing to respond to it.

Aisha Shahid is an Associate at the global immigration law firm Fragomen.