Table of Contents
Summary
Highly skilled talent is a critical driver of economic growth, competitiveness, and innovation. As global competition for talent intensifies, the UK must remain an attractive destination for the world's top talent.
To supercharge growth and innovation, the UK should focus on attracting "lost Einsteins"—individuals with incredible potential but who face socioeconomic, educational, or geographical barriers that prevent them from realising their full potential. By actively seeking out and attracting emerging talent from around the world, the UK can tap into a vast pool of underutilised talent and ideas.
Existing visa pathways, such as the Global Talent Visa, are effective in attracting established professionals but do not address the untapped potential of emerging talent. The UK should use the Youth Mobility Scheme (YMS) as a tool to attract, identify, and retain emerging foreign-born talent.
The YMS allows young individuals from select countries and territories to live, work, and study in the UK for up to two years, with the option for individuals from Australia, Canada, or New Zealand to extend their visa for an additional year. After the YMS, applicants can apply for other visas.
The YMS gives emerging talent the flexibility to explore various avenues for personal and professional growth in the UK. Once the two years are up, the YMS functions as a natural selection process: individuals who demonstrate exceptional skills or entrepreneurial drive are able to stay in the UK by applying and obtaining other visas like the Skilled Worker visa or the Innovator Founder visa.
The UK should:
Expand the YMS by seeking new agreements with priority countries
Promote the YMS abroad as a visa pathway for emergent talent
Inform current YMS migrants about permanent visa options
Challenge and Opportunity
The UK faces a critical challenge in the global race for talent. Other countries are implementing ambitious migration policies to attract skilled workers. The UK must adapt its strategies to remain competitive. Existing visa pathways favour established professionals, but overlook the untapped potential of emerging talent. The UK should therefore expand and improve its Youth Mobility Scheme (YMS) to identify and retain emerging talent, supporting UK innovation and economic growth.
A Global Race for Talent
Historically, high-skilled immigrants have contributed an outsized share to innovation, productivity, and growth in the UK:
At least 20% of FTSE 100 companies were founded by a first-generation immigrant and 39% of the UK’s fastest-growing startups have at least one immigrant co-founder.
Migration boosts productivity in the UK and migrants are, on average, around 2.5x more productive than UK born workers.
Migrants have a more positive net fiscal contribution than natives and the net fiscal balance of overall immigration to the UK between 2001 and 2011 amounts to a positive net contribution of about £25 billion.
As the Migration Advisory Committee acknowledges, high-skilled migrants in particular have “a clear benefit to existing residents”.
However, the UK faces intensifying competition from other countries in the race to attract talent. All of the UK's major competitors are implementing ambitious migration policies aimed at boosting economic productivity by attracting top talent; for example:
China launched “The Thousand Talents Plan” to attract leading researchers and experts from around the world.
Canada launched a Tech Talent Strategy that eases immigration restrictions to attract foreign entrepreneurs and skilled workers.
The U.S., in its recent AI Executive Order, included measures to ease migration restrictions and compete for foreign talent.
The UK faces a fierce contest to attract international talent. Pathways like the High Potential Individual visa and the Global Talent visa have been instrumental in attracting established professionals but overlook the untapped potential of emerging talent.
To remain competitive, the UK must focus on attracting emerging talent—individuals with high potential who may not have established track records. This would allow the UK to capture “lost Einsteins” that otherwise would not get noticed by the system. These individuals are often hindered by visa categories that solely focus on established professionals or students in other countries, giving the UK a unique opportunity for advantage over competitors to focus on emerging talent.
Identifying emerging talent is challenging due to a pernicious cycle: the most promising individuals often come from places with limited opportunities to develop and showcase their talents, making it difficult for them to establish globally recognized track records and secure skilled visas. Consequently, these individuals find themselves caught in a catch-22 situation: they need opportunities to prove their worth, but without a proven track record, those very opportunities remain elusive.
The Youth Mobility Scheme as an Identification Tool for Emerging Talent
The YMS offers a rare opportunity to identify and retain emerging talent. The YMS provides young individuals aged 18-30 (or up to 35 for some participating countries) with the chance to work and study in the UK for up to two or three years. This serves as an accessible route for promising individuals to showcase their skills and contribute to the UK's economy. Unlike the High Potential Individual visa, which requires an elite university degree, the YMS is more inclusive and accessible to unconventional talent.
The YMS can function as an effective selection process because it can filter for individuals who demonstrate exceptional skills, entrepreneurial drive, and a desire to make a lasting impact in the UK labour market. The flexibility of the visa means that, during their stay, high-potential talent can acquire new skills, join accelerator programs, secure funding for startups, or convert internships into full-time job offers. This flexibility allows them to explore various avenues for personal and professional growth. High-potential candidates can then apply for more permanent visa categories, such as the Skilled Worker visa or the Innovator Founder visa. Those who fail to develop the requisite skills are required to leave, while those who succeed are provided with a more enduring pathway to stay in the UK.
Expanding the YMS would send a clear message to young talent around the world: the UK offers an opportunity to experience life as part of a 'working holiday' and provides a clear pathway for the most talented and driven individuals to prove their worth and earn the right to stay, contribute, and thrive. By expanding and improving the YMS, the UK can position itself as the premier destination for the world's emergent talent.
Plan of action
The UK should expand and improve the YMS to attract emerging talent, by (1) negotiating with priority countries to establish new YMS agreements; (2) advertising YMS abroad, through institutions like the British Council, as a pathway to permanent UK visa options, in order to attract top talent, and (3) informing existing YMS migrants of permanent visa options through regular communications while they are in the UK.
Expanding YMS to additional partner countries:
The UK should identify priority countries for establishing new YMS agreements, including considering the following countries:
Improving visa pathways information
The UK should increase uptake of other visa categories by those in the country on the YMS by:
Updating the YMS information on the UK government website to explicitly position it as a pathway for emerging talent.
Launching targeted digital outreach campaigns in YMS countries, such as through the British Council, to raise awareness of the scheme and encourage applications from high-potential individuals.
Introducing regular communications, through social media, emails and letters, with existing YMS migrants, to inform them of post-YMS visa options.
FAQs
Why is the YMS an attractive visa pathway for the UK?
The YMS stands out as a particularly beneficial visa pathway for the UK, as it has several key advantages:
1) Fiscal Benefits to the UK:
The YMS primarily attracts young adults aged 18-30, with some agreements extending to 35. Research consistently shows that age is the most crucial factor in determining the net fiscal contributions of immigrants compared to native populations. By bringing in a cohort of young, working-age individuals, the YMS bolsters the labour market and generates positive economic impacts.
The scheme is structured to ensure that participants contribute more to public finances than they withdraw. Applicants must prove financial self-sufficiency and are ineligible for social security benefits. YMS participants cannot bring dependents, mitigating potential pressures on public services. The mandatory NHS surcharge provides immediate financial benefits to the UK and guarantees that participants' healthcare costs are covered.
2) Benefits for Businesses:
Unlike the skilled worker visa, the YMS does not require employer sponsorship, eliminating associated fees and bureaucratic obstacles. This is particularly appealing to small businesses, which can recruit internationals using the YMS without navigating complex sponsorship requirements. Businesses have advocated expanding the YMS to capitalise on its streamlined process and ability to support early-stage business growth.
Start-ups, in particular, often lack the resources to obtain a Sponsor Licence through the intricate and expensive process. The YMS provides a solution by allowing them to hire talented international workers for two years, offering a vital window to secure a Sponsor Licence without impeding growth.
3) Attracting International Talent:
The YMS application process is relatively straightforward. This ease of access helps attract a wide array of individuals. By not tying participants to a single employer, the scheme's structure significantly reduces the risk of exploitation and promotes fair wage standards. This flexibility empowers individuals to pursue the most suitable employment opportunities, boosting job satisfaction and overall productivity.
Once in the country, the YMS offers remarkable flexibility, allowing participants to work, travel, and study. Individuals can engage in various occupations, including both skilled and less-skilled roles. The diverse range of positions currently held by participants—from entry-level jobs to roles in high-demand professional fields like finance, nursing, or teaching—demonstrates the scheme's success in attracting a broad spectrum of talent.
In recognition of these benefits, the UK has already begun implementing new YMS rules, expanding the number of participating countries and increasing quotas with partner nations. However, the YMS should be expanded to capitalise further on these benefits.
How would this impact net migration into the UK?
The Youth Mobility Scheme (YMS) is a temporary migration program, allowing participants to stay in the UK for a maximum of two or three years without the option to settle permanently unless they transition to another visa category, such as the Skilled Worker route. As a result, the YMS does not directly contribute to net migration to the UK.
In 2022, approximately 16,900 people came to the UK on the YMS, with the majority being citizens of Australia (45%), New Zealand (19%), and Canada (16%). This distribution is likely influenced by the quota system, which allocates the highest number of places to these countries. On average, countries utilised about 50% of their allocated places in 2022, with no country reaching its maximum quota.
If the UK government were to negotiate all of the suggested schemes—France, Spain, Germany, Nigeria, and Brazil—at the proposed quotas, there would be a total of 21,000 new places available. Assuming an average uptake of 50%, this would result in approximately 10,500 additional young people moving to the UK annually on a temporary basis. These people would be counted as temporary workers and would not contribute to net migration into the UK.
However, individuals on the YMS could potentially impact net migration if they successfully move to other visa categories. Currently, there is no data available on the number of people who enter the UK on the YMS and subsequently obtain other visa categories to remain in the country once their 2-3 year period has ended. This lack of data makes it challenging to accurately estimate the long-term impact on net migration.
By providing clear information on how participants in the YMS can transition to other visa categories, the UK government could encourage a higher number of individuals to apply for long-term work visas, which do contribute to net migration numbers. Given the restrictions and requirements of these visa categories, the applicants would likely be highly skilled. Since there is currently no data collection on the number of YMS participants moving onto other work visas, more comprehensive data collection and analysis would be necessary to accurately assess the long-term impact of the YMS on net migration.
To illustrate the potential impact, let's consider a hypothetical scenario. Assuming a total of 27,400 people come to the UK under an expanded YMS (based on the estimated increase from the expansion) and estimating that 20% of YMS participants successfully apply for and obtain other visa categories due to improved visa pathway information, this would result in approximately 5,480 highly skilled individuals moving to the UK. While significant, this influx of skilled workers is relatively modest compared to the 221,173 work visas granted to applicants in 2022.
What if the individuals in the UK on the YMS do not end up being high-potential? How does this impact the labour market?
Even if YMS participants do not enter into the most productive sectors, they can still have significant positive impacts on the UK labour market. The UK is facing significant labour shortages across critical sectors. Over 80% of UK employers have reported that they are struggling to find the talent they need. As of February 2024, there were over 908,000 job vacancies in the UK, a 11% increase compared to pre-pandemic levels.
For example, hospitality has been one of the hardest hit by these shortages. The industry heavily relies on young, dynamic workers to fill roles such as servers, bartenders, and hotel staff. The YMS can play a crucial role in addressing this gap by providing a steady influx of young talent from participating countries, and groups like UKHospitality have already urged the government to expand the scheme.
While attracting high-potential individuals is one goal of the YMS, the scheme generates clear economic benefits for the UK even when participants fill essential non-high-skilled roles. Expanding the YMS would be a timely and strategic move to alleviate labour market pressures and support businesses.
Julia is a co-director of the UK Day One Project. She was also instrumental in setting up the Talent Mobility Fund (TMF), a philanthropic fund focused on helping talent move to opportunity through the increased use of existing, legal immigration pathways. TMF is focused on (1) unlocking bottlenecks for increased STEM immigration to the U.S. and (2) increasing uptake of immigration pathways in OECD countries to address global challenges.
Sophia is a Manager at Labor Mobility Partnerships (LaMP) where she is responsible for improving labour migration systems in Europe and Australia Pacific. Her projects focus on streamlining processes with governments and bringing innovative financial solutions to the labor migration environment. Previously she published the Global Britain report setting out policy proposals for a post-Brexit immigration system and led a UK cross-sectorial coalition of trade bodies and other organisations that brought about decisive changes to the UK immigration system.