UK tech hit by double trouble: Fewer foreign techies amid skills squeeze
(2026/02/24)
- Reference: 1771928115
- News link: https://www.theregister.co.uk/2026/02/24/brit_tech_firms_face_falling/
- Source link:
The number of international workers applying for a visa to work in the UK's tech sector dropped 11 percent between Q2 and Q3 2025, and was down 6 percent year-on-year, according to consultancy RSM UK.
At the same time, domestic talent is expensive and non-technical staff are proving difficult to upskill.
These findings come from RSM's [1]Technology Industry Outlook 2026 report, based on interviews with 300 tech executives.
[2]
Almost all surveyed – 98 percent – are using AI, which RSM describes as a double-edged sword: a driver of growth and investment on one hand, and the primary reason tech workers are losing their jobs on the other.
[3]
[4]
The claim about AI sits awkwardly alongside other research. A recent study from the National Bureau of Economic Research found that more than [5]80 percent of companies have seen no discernible impact from AI on either employment or productivity.
RSM's own numbers are mixed on the point. AI is a source of confidence with 82 percent of respondents at AI companies expecting to grow under the current UK government, and it sits at the heart of both new product development and operational improvements. Yet more than a quarter of all respondents said they had cut headcount in the past year, with 51 percent citing roles augmented or replaced by AI as the main reason, compared to just 23 percent who blamed economic conditions.
[6]
On what would help, 20 percent called for better incentives to encourage financial investment in British AI, while nearly as many said greater skilled immigration was essential, a notable ask given the political temperature around the issue.
Around 16 percent in each case wanted direct government funding for AI companies and government-backed initiatives to address skills gaps.
"Tech businesses are being hit with both a decline in skilled immigration and existing talent shortages. Workforce is likely to be one of the biggest challenges for the UK tech industry in the year ahead," said RSM technology industry senior analyst James Bull.
[7]Altman: You think AI is wasted energy? Try raising 100 billion humans
[8]Hard drives already sold out for this year – AI to blame
[9]Gemini users say their chat histories have quietly vanished
[10]Global regulators say AI image tools don't get a free pass on privacy rules
"Employers are having to grapple with AI – adopt it too quickly and there's a risk of damaging employee engagement, but adopt it too slowly, and businesses could lose out on increased productivity and growth opportunities," he added.
A separate study by investment management biz Rathbones Group claims 6,000 business owners have already left the UK over the past two years, with the largest proportion coming from the tech sector.
[11]
Data from Companies House, the official registrar of UK firms, shows that 8,423 companies saw one of their owners leave the country. Rathbones claims the United Arab Emirates was the primary destination for those leaving Britain, with Spain in second, and the US in third place.
Concerns about economic competitiveness, tax pressures and the attractiveness of other jurisdictions were given as reasons, so perhaps it is largely AI companies that are confident they will grow under the current UK government. ®
Get our [12]Tech Resources
[1] https://view.rsmuk.com/campaigns/technology-industry-outlook-2026/
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/aiml&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2aZ2E0hk8N3exCOs62g-4ggAAANI&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/aiml&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aZ2E0hk8N3exCOs62g-4ggAAANI&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/aiml&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33aZ2E0hk8N3exCOs62g-4ggAAANI&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[5] https://www.theregister.com/2026/02/18/ai_productivity_survey/
[6] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/aiml&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aZ2E0hk8N3exCOs62g-4ggAAANI&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[7] https://www.theregister.com/2026/02/23/sam_altman_ai_efficiency/
[8] https://www.theregister.com/2026/02/20/ai_blamed_again_as_hard_drives_sell_out/
[9] https://www.theregister.com/2026/02/23/gemini_users_say_their_chat/
[10] https://www.theregister.com/2026/02/23/privacy_watchdogs_ai_images/
[11] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/aiml&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33aZ2E0hk8N3exCOs62g-4ggAAANI&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[12] https://whitepapers.theregister.com/
At the same time, domestic talent is expensive and non-technical staff are proving difficult to upskill.
These findings come from RSM's [1]Technology Industry Outlook 2026 report, based on interviews with 300 tech executives.
[2]
Almost all surveyed – 98 percent – are using AI, which RSM describes as a double-edged sword: a driver of growth and investment on one hand, and the primary reason tech workers are losing their jobs on the other.
[3]
[4]
The claim about AI sits awkwardly alongside other research. A recent study from the National Bureau of Economic Research found that more than [5]80 percent of companies have seen no discernible impact from AI on either employment or productivity.
RSM's own numbers are mixed on the point. AI is a source of confidence with 82 percent of respondents at AI companies expecting to grow under the current UK government, and it sits at the heart of both new product development and operational improvements. Yet more than a quarter of all respondents said they had cut headcount in the past year, with 51 percent citing roles augmented or replaced by AI as the main reason, compared to just 23 percent who blamed economic conditions.
[6]
On what would help, 20 percent called for better incentives to encourage financial investment in British AI, while nearly as many said greater skilled immigration was essential, a notable ask given the political temperature around the issue.
Around 16 percent in each case wanted direct government funding for AI companies and government-backed initiatives to address skills gaps.
"Tech businesses are being hit with both a decline in skilled immigration and existing talent shortages. Workforce is likely to be one of the biggest challenges for the UK tech industry in the year ahead," said RSM technology industry senior analyst James Bull.
[7]Altman: You think AI is wasted energy? Try raising 100 billion humans
[8]Hard drives already sold out for this year – AI to blame
[9]Gemini users say their chat histories have quietly vanished
[10]Global regulators say AI image tools don't get a free pass on privacy rules
"Employers are having to grapple with AI – adopt it too quickly and there's a risk of damaging employee engagement, but adopt it too slowly, and businesses could lose out on increased productivity and growth opportunities," he added.
A separate study by investment management biz Rathbones Group claims 6,000 business owners have already left the UK over the past two years, with the largest proportion coming from the tech sector.
[11]
Data from Companies House, the official registrar of UK firms, shows that 8,423 companies saw one of their owners leave the country. Rathbones claims the United Arab Emirates was the primary destination for those leaving Britain, with Spain in second, and the US in third place.
Concerns about economic competitiveness, tax pressures and the attractiveness of other jurisdictions were given as reasons, so perhaps it is largely AI companies that are confident they will grow under the current UK government. ®
Get our [12]Tech Resources
[1] https://view.rsmuk.com/campaigns/technology-industry-outlook-2026/
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/aiml&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2aZ2E0hk8N3exCOs62g-4ggAAANI&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/aiml&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aZ2E0hk8N3exCOs62g-4ggAAANI&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/aiml&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33aZ2E0hk8N3exCOs62g-4ggAAANI&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[5] https://www.theregister.com/2026/02/18/ai_productivity_survey/
[6] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/aiml&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aZ2E0hk8N3exCOs62g-4ggAAANI&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[7] https://www.theregister.com/2026/02/23/sam_altman_ai_efficiency/
[8] https://www.theregister.com/2026/02/20/ai_blamed_again_as_hard_drives_sell_out/
[9] https://www.theregister.com/2026/02/23/gemini_users_say_their_chat/
[10] https://www.theregister.com/2026/02/23/privacy_watchdogs_ai_images/
[11] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/aiml&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33aZ2E0hk8N3exCOs62g-4ggAAANI&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[12] https://whitepapers.theregister.com/
Anonymous Coward
Who'd want to come to the UK to work with the rise of Farage and his fascist cronies?
Too Expensive?
Throg
“At the same time, domestic talent is expensive and non-technical staff are proving difficult to upskill.”
Ah, so it’s not so much about the availability of boffins and more to do with replacing cheap outsourcing with supposedly even cheaper “AI”.
It really is becoming a race to the bottom, isn’t it?
Groo The Wanderer - A Canuck
Real culprit: the obscene tax load in the UK for 6-figure salaries. Why pay half your staff wages to the government when you can just contract an off-shore provider from a friendlier taxed nation?
Note to Employers
You don't HAVE to grapple with AI. It's a tool like any other, and for many businesses has absolutely zero relevance to the work you do, or minimal benefit at best.
You didn't HAVE to grapple with grammar checkers in Word, which for many businesses is pretty much what AI can offer - a tool to automate some communication tasks.
You didn't HAVE to grapple with website chatbots, which many users find next to useless when it comes to actually solving their problems.
Sure, AI may eventually improve things, but early adopters are being bitten hard when it turns out services are over sold, under constrained and cost far more than the benefits they provide.
And as far as the employment stuff is concerned, can we talk honestly about the many challenges facing the workforce and employers at the moment, quite a few of which are the responsibility of the government, which seems to be asleep at the wheel at the moment as businesses and individuals struggle with rising costs, poor infrastructure and lack of support.