Brexit self-harm means London no longer the Holy Land for all fintech talent
The founder of digital challenger bank Revolut is calling for special visas for fintech professionals so London and the UK don’t lose the best talent to countries like Germany and France.
We already know that tech hubs across Europe are eating into London’s share of venture capital investment, but the battle for talent is as and arguably more important.
Nikolay Storonsky is reported as saying: “With all of the political uncertainty kicking off right now, lengthy immigration processes and bureaucracy will only slow down the UK fintech industry’s growth, and we risk losing out on the best talent to other EU countries such as Germany and France.”
At such a critical time in the whole Brexit mess I put Storonsky’s views to a group of UK fintechs to see what they thought.
Michael Kent founder and CEO at app based remittance provider Azimo, which is based in London, agrees that there is a shortage of UK talent. “Access to talent is a huge and on-going problem – the fintech sector relies heavily on global talent to plug the serious skills gap facing this country.”
He says he is already seeing young tech workers changing their minds about building their careers in the UK. The affordability, good work life balance and interesting job prospects in other European cities are proving attractive. “Millennial workers are looking at cities like Berlin, Barcelona and Amsterdam to grow professionally – and they are also attracted to the vibrancy of these hubs and the lower cost of living.”
Azimo has 135 employees and about 85% of these are not from the UK, most of which are from EU countries.
The stakes are high. Kent says there’s always a concern that EU workers and those from further afield will choose to live elsewhere if London and the UK doesn’t have the right business conditions to attract the best talent. “We need to ensure we continue to maintain a good environment for businesses while also making people feel welcomed to build lives here.”
The best solution, one shared by many, would be to cancel Brexit says Kent who said there should be more recognition of ”the huge contributions that migrants make to the economic health and entrepreneurial vibrancy of the UK.” The perceived problems that led people to vote Brexit were conjured by politicians through negative rhetoric about immigrant workers.
He agreed with Storonsky that the Government should create a fast track digital skills visa, “to ensure that foreign workers can continue to come to the UK without endless bureaucratic obstacles.”
Gavin Sewell CEO at Insurtech Honcho, which is based in North East England, said the challenges attracting talent go beyond London.
“We have a strong fintech industry not only in London, but across the rest of the UK, and the challenges faced in London are also faced, and perhaps to a greater extent, across the rest of the UK. For example, in the North East we have shining lights such as Atom Bank.”
“Whilst I share some of Storonsky’s concerns, I am not sure they are quite the same concerns. I do believe we have a serious shortage of homegrown technology talent across the full spectrum of technology disciplines in the UK.”
He said there are shortages in people from the tech side of fintech with demand for experts in areas including data science, APIs, machine learning and artificial intelligence high.
But he does not see the same shortage today of talent in the ‘fin’ element of fintech. “The UK (and admittedly London) has long been the global leader in financial services with ‘The City’ providing a huge contribution to the GDP of the UK. The talent that exists in that sector is enormous and is the starting point for much of the fintech growth in the UK.”
However he said they do encounter difficulties finding the tech talented needed to realise their ambitions. “This is where we as a country need to be very careful not to interrupt the flow of technology talent from abroad.”
He would also welcome a special visa system. “I would very much like to see a simple and quick talent and demand related visa system implemented post Brexit that will allow UK technology businesses to quickly and easily hire talent from abroad (EU and rest of world equally) where they are unable to fill those roles locally. This is an absolute must for me and I am therefore concerned about recruitment post Brexit if the right kind of visa system is not implemented.”
Andrius Sutas, CEO and co-founder, at biometric identity management software supplier AimBrain agrees that the shortage is particularly pronounced in computer sciences such as machine learning, AI and robotics. “Despite having some of the world’s best universities in the UK, competition for top tier talent continues to be brutal.”
Just over half of AimBrain’s workforce is from outside of the UK, with the majority from other EU countries.
Sutas said he is always concerned about recruitment and added that the current political instability is not helping overcome the technical skills shortage.
“The routes into tech careers are getting much clearer and more inclusive, which will help in the long term,” he says. “However, the government didn’t spot the skills gap until too late and so ‘fixes’ like specialist tech visas could help in the short term.”
Training people in the UK is an option to address the shortage. Evgeny Shadchnev, CEO of software bootcamp Makers, says the talent is here but needs to nurtured and trained. “So the shortage is due to the fact that we aren’t reaching out effectively to provide workers with the skills they require to enter the fintech sector,” he says.
He added that underrepresented sections of the population – especially women, need to be reached if skills gaps are to be closed. “The gender gap in the skills sector has increased over the years – despite efforts to attract more females into software coding and other digital careers.”
“This has nothing to do with Brexit and everything to do with our societal bias and overall lack of support for women to enter the digital workforce.”
But he added that if Brexit makes it difficult for talent to come here then it will be difficult for his company to scale up and grow.
“We are concerned about recruitment post Brexit, but we see more opportunities to support the talent we already have here in the UK,” says Shadchnev. Makers has for example introduced an apprenticeship scheme that is funded by the government’s Apprenticeship Levy scheme, in which large organisations pay 0.5% of their costs into a kitty that can then be spent on training courses offered by registered providers. It offers training for people to get the software coding skills that businesses need so that they can start employment in the digital sector the moment they graduate.
To help address the problems he says the government should make coding lessons compulsory in the classroom. “We should encourage mentorship programmes for students to inspire them to pursue digital careers.”
It is not just the finance providers that are already seeing a reduction in EU candidates. According to Shadchnev the numbers of students from other EU countries coming to the UK has been falling since the Brexit referendum. “In the past about a third of our students have come from the EU, but that number has dropped since the Brexit debacle kicked off.”
If you are a fintech with views on this, please add your comments.