CIO wanted, no experience necessary: the IT skills shortage

The reaction by contractors and recruitment agencies to the UK government's latest plans for "fast track" visas highlights the tricky nature of importing skills.

Albeit with a vested interest, they make a simple argument - reducing the time it takes to obtain work permits for non-EU workers from three months to one week, while at the same time enabling multinational companies to self-certify visas for potential IT specialists from overseas will kill the incentive for companies to train workers from other declining sectors in the UK. It will worsen the skills crisis in the long term, they argue.

Current EU estimates suggest the shortage will reach around 1.6 million people by 2002. The concern is that salaries will rise, profitability will be cut and potential employees could move elsewhere. Already the skills shortage is stifling the growth of high-tech start up companies.

David Blunkett, education and employment minister, this week argued his latest initiative will unblock the skills bottleneck and keep the economy buoyant until such time as national training initiatives can catch up with demand.

His position mirrors that of many European governments today.

Denmark is having to rethink its long-held anti-immigration stance while the German government faced a backlash in March after it announced a scheme to give 20,000 green card visas to non-EU IT specialists.

Blunkett emphasised that the proposals won't displace existing domestic training incentives. He also denied that immigrants are likely to be paid less than the market rate in the UK. However, little was said about how this is going to be enforced. At the very least the economics of supply and demand will mean salaries would go down - great for big business but not so good for the one-person company.

Andy White, director of contractor forum Shout99, argues: "This policy is in direct contrast to what the government is doing with IR35. IR35 gives one-person companies a very small allowance for IT training when they should be giving an incentive."

He adds: "The government should be giving both big and small companies an incentive to train their employees up in IT rather than bring in people from overseas."

Vincent Cable, Liberal Democrat MP in the UK, strongly supported contractors over the issue of IR35. However, he believes the government's latest proposals haven't gone far enough.

"I don't believe in a protective policy for visas. In fact, I am strongly in favour of making them more broadly available," he says.

Cable argued it would be more appropriate to increase work permits for people with senior management and training skills.

David Taylor, president of IT director association Certus, takes a similar view. He believes there would be no shortage of skills at all given the right leadership.

So is the government on the right track?

Keith Evans, partner at PricewaterhouseCoopers, thinks so. "There is such a shortage of skills in Europe that there is plenty of opportunity for everyone, and bringing people in is the only option," he says.

In short, the government is damned if it does and damned if it doesn't. However, it is understandable for the contractor sector to voice its concerns. After all, it doesn't just take big businesses to keep an economy running, and as Shout99's Andy White points out, the government's policy might "let multinational companies off the hook" by allowing them to side-step investment in IT skills.