New data shows a slowdown in international visa applications in the UK tech sector, highlighting an industry already under pressure from a growing talent squeeze. But some Northern industry leaders suggest the trend points to a deeper structural shift, not just a shortage of skills.
Following a Freedom of Information request made by professional services firm RSM UK to UK Visas and Immigration, the number of international workers applying for a visa to work in UK tech jobs has been falling significantly in recent months.
READ MORE: ‘It feels like there is no pipeline’: Inside the North’s brewing tech talent gap
In 2025, applications dropped 11% from 8,739 in the second quarter of the year to 7,768 in the third quarter. This was 6% down year-on-year from the same quarter in 2024.
RSM’s Technology Outlook report also highlighted mounting workforce pressures across the sector as 22% of tech leaders reported maintaining employee engagement as their biggest workforce challenge, followed by the rising cost of UK talent (19%) and the need to upskill non-technical staff (17%).
For Jonathan Moran, director of independent recruitment group Better Placed, the decline in skilled migration in UK tech comes as no surprise based on what the firm is seeing across Manchester, Leeds, and the wider North.
“Many of the founder-led and scaling businesses we work with simply aren’t set up to sponsor visas. The cost, compliance and admin burden can be significant for SMEs without in-house HR or legal teams. For some, it’s just not practical,” he explains.
Following a recent Prolific North roundtable with Northern tech leaders, the discussion highlighted nearshoring and offshoring as increasingly attractive options, as rising wages, higher corporation tax, and increased employer NI contributions make retaining UK developers harder.
Moran agrees there’s been a “clear rise” in companies outsourcing parts of their development teams, rather than hiring international workers to come to the UK.
“South Africa and Portugal come up regularly. Strong technical talent, English-speaking proficiency, similar time zones, plus the ability to scale up or down without long-term UK hiring risk. For smaller firms, that flexibility can seem safer, particularly at an earlier stage.”
He adds that the workforce pressures identified in the report are visible on the ground too.
“Engagement is harder in lean teams, where losing one senior hire has a big impact. And while salary inflation has cooled since the 2021–23 spike, mid- and senior-level UK tech talent remains expensive, particularly for start-ups in the region.”
Northern cities are also building their AI start-up ecosystems, with firms like Decently, Build Concierge, and Polybox continuing to scale across Manchester, Leeds, and Newcastle. But Moran says “reduced access” to international talent is forcing smaller businesses to “think differently” about team structure, location, and their growth strategy.
Ruby Melling, founder and managing director of people consultancy talentloop, adds that the Northern tech market is being squeezed from both sides: talent supply is tightening even as performance expectations rise.
“An 11% drop in international tech visa applications is significant, and you can feel the impact on businesses here, especially those outside London who already compete with the pull of bigger brands and higher salaries,” she explains.
“But the issue isn’t just the decline in applicants, it’s also the increasing cost barrier to bringing people in. The minimum salary thresholds for sponsoring international talent continue to rise, and for many Northern businesses this pushes global talent out of reach. It creates a two‑tier system where larger, better‑funded companies can still compete for international talent while regional organisations are squeezed even harder.”
For years, international recruitment has plugged persistent skills gaps across UK tech. But Claire Foreman, director at the Greater Manchester Institute of Technology (GMIoT), says the model is now “vulnerable” to global pressures and policy changes.
“A decline in skilled migration spotlights the need for regions like Greater Manchester to double down on developing home-grown technical talent,” she explains.
“In Greater Manchester, we’re already tackling this head-on by working with leading employers and colleges to co-design higher technical qualifications and apprenticeships that align with real regional demand and we collaborate with organisations like GCHQ, Siemens, Laing O’Rourke and, most recently, the BBC to embed employer insight directly into our courses.
“The opportunity now is not just to replace lost migration numbers, but to build a more resilient, regionally anchored talent pipeline that keeps Manchester’s tech and engineering sectors thriving.”
Melling points to AI automating many traditional entry-level roles now, adding that employer uncertainty, rising expectations, shrinking pipelines, and unclear future skills make it “no wonder” that tech leaders cite employee engagement as a top challenge.
“Businesses here are incredibly resourceful, but they’re being forced to work harder than ever to create high‑performance environments that people actually want to stay in. Retention isn’t just about culture anymore – it’s about clarity, capability, and removing the points of friction that cause talent to burn out or check out.
“Organisations are in a constant fight to find, retain and get value from the people they already have, and the pressure is becoming relentless.”
