MAC recommends keeping Skilled Worker salary threshold at £41,700

The Migration Advisory Committee (MAC) has published its latest review of salary thresholds and discounts across the UK’s sponsored work routes. Although the report does not change the Immigration Rules by itself, it is a clear sign of where policy may move next, particularly after the sharp rise in Skilled Worker salary requirements.

The MAC’s review offers a route back to something more usable, while still keeping salary policy as a tool for managing migration and protecting resident workers.

The MAC repeats its longstanding recommendation that occupation-specific salary thresholds should be set at the 25th percentile of earnings, rather than the current median. It argues the median is too high, blocking legitimate roles within occupations and creating unnecessary barriers to recruitment, without materially improving protection against undercutting.

The MAC recommends keeping the general threshold at £41,700, noting this would support fiscal objectives while allowing priority sectors to recruit. It also favours scheduled annual updates, making future increases more predictable.

For new entrants (including younger workers and recent UK graduates), the MAC recommends a single discounted minimum salary of £33,400. It also questions the current four-year limit, suggesting it does not reflect realistic pay progression where the full rates are high. This point matters for employers hiring graduates and for migrants planning towards settlement.

The MAC recommends abolishing the PhD salary discount, finding no strong evidence that PhD holders require lower salary rules.

The MAC again rejects regional variation, arguing wage differences within regions are greater than the differences between them and that regional rates would add complexity.

The MAC recognises the importance of special treatment for roles on national pay scales, such as NHS staff. At present, the general threshold for pay scale occupations is set at 80% of the 25th percentile of all RQF 3+ roles (£25,000), with occupation-specific thresholds aligned to national pay bands.

However, the MAC highlights that this preferential treatment effectively supports public sector recruitment while making international talent less accessible to private sector employers, who must meet significantly higher minimum salary thresholds for comparable skill levels.

For roles on the proposed Temporary Shortage List (TSL), the MAC recommends that there should be no discounted occupation-specific going rates, as the route is intended for fully qualified workers rather than as an entry pathway. It suggests using the median for occupation-specific thresholds.

If the TSL does not provide a route to settlement, the MAC suggests lowering the general threshold from £41,700 to at least the 30th percentile of UK full-time earnings (around £30,900). If the route were to lead to settlement, a higher threshold may be appropriate. The MAC cautions that overly high thresholds could restrict growth in Industrial Strategy sectors.

For the Global Business Mobility – Senior or Specialist route, the MAC recommends increasing the going rate from the 25th percentile to the median, to ensure the route is used for genuinely senior or specialist workers.

The MAC is critical of the Scale-up visa, describing it as offering limited benefit and poor value for money. It recommends aligning Scale-up salary thresholds with those of the Skilled Worker route, while acknowledging that this would remove the main incentive for employers to use the route (aside from the Immigration Skills Charge exemption). Given low uptake and the ability of sponsored workers to move employers after six months, the MAC suggests the route may become effectively dormant.

Finally, the MAC recommends that the government provide clearer guidance for employers on their legal obligations when recruiting candidates who require sponsorship, particularly in relation to employment law, equality and discrimination. This is intended to support employers who may wish to prioritise candidates who do not require sponsorship while remaining legally compliant.

The MAC’s review does not signal a wholesale relaxation of the UK’s work visa system. Instead, it points towards a recalibration of salary thresholds intended to preserve control over migration while restoring a degree of practicality for employers and new labour market entrants. By recommending lower occupation-specific thresholds, a more realistic approach to new entrant salaries, and tighter alignment between salary levels and the purpose of individual routes, the MAC acknowledges the operational challenges created by the April 2024 changes.

Whether these proposals translate into changes to the Immigration Rules will ultimately be a political decision. In the meantime, the review provides employers with a clearer sense of the direction of travel and highlights the importance of workforce planning, salary progression and compliant recruitment practices. For sponsored workers and graduates, the recommendations suggest cautious grounds for optimism but also underline the continued need to plan carefully around salary requirements, particularly where settlement is a long-term objective.

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