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Immigration cap threatens UK's competitive edge

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A leading business advisory committee has warned the government its immigration cap on skilled workers from outside the EU threatens to eliminate the UK's global competitive edge.

The -- which was set up in September 2008 by the then Chancellor of the Exchequer, Alistair Darling -- has compiled a list of businesses badly served by the immigration cap.

One of the businesses, a 'magic circle' law firm headquartered in London, has been set a cap on the number of people it can hire from outside the E.U. (e.g., Japan, U.S.A., etc), which is lower than required to maintain its competitive edge in what is now a global market for legal services.

Another company in the information services sector has already used up its visa quota for the year. "We believe that our quota, which is very small, was based on 15% of our usage of these types of visas from July 2009 to March 2010," said a spokesperson. "We have currently used our entire allocation of Tier 2 visas until March 2011 and believe that additions/extensions are near impossible. The restrictions have stopped us being able to move forward on a couple of instances so far this year."

Earlier this month, the Confederation of British Industry (CBI) criticised interim arrangements for an immigration cap, saying: "The system is being poorly managed and proving a real headache for firms trying to keep on valued foreign members of staff, or recruit specialists from overseas."

Car makers also vehemently oppose the current system and have called for an 'exemption' for automotive industry workers. Speaking at the Paris Motor Show, Minister for Business and Enterprise Mark Prisk acknowledged the government is considering relaxing rules for "non-EU technical staff".

Professional and Business Services group head Michael Snyder has indicated the government could face a backlash if only certain areas of the economy are exempted from the cap, however.

"We recognise that the Government has to do something about overall numbers but we need a sophisticated approach for business," said Snyder. "An arbitrary cap appears to be being applied irrespective of the stage of development the business is at. And the cap doesn't take into account the tangible benefits that [migrant workers] bring to the UK, such as linguistic skills."

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