Sir Keir Starmer has been cautioned that his party's proposed crackdown on foreign workers could inflict significant damage on the UK economy, with potential losses reaching hundreds of millions of pounds.
Migration Watchdog Warns of Economic Damage
The Migration Advisory Committee (MAC), the independent body that advises the government, has delivered a stark warning. Its analysis, released on Wednesday 17 December 2025, found that plans to increase salary thresholds for skilled workers coming to Britain could wipe between £520 million and £710 million from the economy. This financial blow would result from thousands fewer migrants contributing to economic activity.
The committee was commissioned in July by the then-home secretary, Yvette Cooper, to examine salary requirements. She had insisted the salary bar "must rise" over concerns that low-paid foreign workers were undercutting British employees. However, the MAC's report advises ministers that the salary threshold for the skilled worker route should remain at £41,700, not be raised to £52,000 as considered.
"Inefficient" Rules and Stark Warnings
The report is highly critical of current occupation-specific salary rules introduced by the Conservative government in April 2024. It argues they are "an inefficient way to reduce net migration" and should be scrapped. The MAC highlighted the illogical outcomes of the system, noting that an IT director earning £85,000 could be barred from a visa if that is below the median for that job, while a librarian on £41,700 could qualify.
Professor Brian Bell, chair of the MAC, stated the skilled worker visa is "crucial" for enabling firms to employ migrants who make "positive fiscal contributions." He stressed that while salary thresholds are essential to prevent wage undercutting, the system must be designed to maximise benefits to the UK.
The committee also raised concerns about the "stark" disparity in English proficiency, finding that 30% of female migrants from Afghanistan, Bangladesh, Turkey, and Syria speak English poorly or not at all. Their research links lower English skills to worse employment outcomes and less civic engagement.
Labour's Sweeping Immigration Reforms
The warning follows Sir Keir Starmer's speech in May, where he unveiled tough new immigration measures, claiming high numbers were causing "incalculable damage." Labour's proposed crackdown includes:
- Requiring degree-level qualifications for skilled worker visas.
- Banning overseas recruitment of care workers.
- Increasing English language requirements.
- Tightening access to skilled worker visas.
Furthermore, Home Secretary Shabana Mahmood has announced radical reforms to settlement rules. Most migrants arriving from 2021 must now wait 10 years for permanent settlement, with low-paid health and care workers facing a 15-year wait. However, high earners can drastically reduce this period; those earning £125,140 can cut the wait to just three years.
A separate Home Office impact assessment, previously reported by The Independent, suggested the wider reforms could leave the UK £4.4 billion worse off over five years, with a best-case scenario of an £0.8bn gain.
