Migration Advisory Committee publishes its comprehensive review of salary requirements for work visas
The Migration Advisory Committee (MAC) yesterday published its review of salary requirements for UK work visas, completing a commission from former Home Secretary Yvette Cooper to assess thresholds and discounts across the Skilled Worker, Health and Care Worker, Global Business Mobility and Scale-up routes.
Image credit: WikipediaYou can download the MAC's 64-page report here.
As the MAC highlights, the various salary thresholds in the immigration system have multiple purposes, including, if desired, reducing net migration, and that setting them at appropriate levels depends on the government's policy priorities.
Importantly, the Committee recommends maintaining the general salary threshold for the Skilled Worker route at £41,700, while lowering occupation-specific thresholds from the median back to the 25th percentile of earnings. It says that that the general threshold is better suited to managing migration levels and fiscal outcomes, while lower occupation-specific thresholds are sufficient to protect domestic workers from being undercut without unintentionally favouring lower-paid occupations or regions.
The Committee says its preferred thresholds would have only a limited effect on net migration, noting that while the general threshold could rise to £48,400 without significant fiscal cost, a further increase to £52,500 would exclude many economically beneficial migrants and thus reduce net fiscal returns. Keeping the general threshold unchanged at £41,700 would maximise fiscal benefits, as well as ensuring that Industrial Strategy sectors can recruit the workers they are likely to need in the future.
The report notes: "These options demonstrate the trade-offs that exist when setting threshold levels. Lower thresholds are likely to allow improved access to the immigration system for employers outside of London and bring fiscal benefits. However, lower thresholds are also likely to result in more visas being granted, and hence higher net migration. The increase in population that results has other costs and benefits for the UK beyond public finances, including impacts on infrastructure, housing and the demographic makeup of the UK."
In its review, the MAC also proposes changes to salary discounts and exceptions. It recommends a single new entrant rate of £33,400 to reflect typical graduate starting salaries, abolishing the PhD salary discount, and, if its general Skilled Worker threshold recommendation is adopted, eliminating the postdoctoral discount.
For the Temporary Shortage List, the Committee recommends keeping occupation-specific thresholds at the median. If the general threshold is lowered, it should not fall below £30,900, a level consistent with a reasonable standard of living. The report also calls for annual updates to salary requirements and questions the value of maintaining small, low-uptake routes, such as the Scale-up visa, without a clear labour market need.
The MAC's all-important conclusions and recommendations are helpfully summarised in chapter 5 of the report, and we've excerpted and reproduced them below:
Review of Salary Requirements
December 2025
MAC
MIGRATION ADVISORY COMMITTEE
[…]
Chapter 5: Conclusions and recommendations
This report fulfils the commission from the previous Home Secretary to review the salary requirements for the Skilled Worker (SW), Health & Care Worker (H&CW), Global Business Mobility (GBM) and Scale-up routes.
The commissioning letter posed the questions below for our consideration.
1. What should the general salary threshold be for the Skilled Worker route?
2. Should there continue to be different salary thresholds for Health & Care Worker visas and the Global Business Mobility and Scale-up routes and, if so, what should these be?
3. What, if any, discounts should apply to salary requirements?
4. Should there be any changes to the current approach to occupational going rates?
5. How frequently should salary requirements be updated?
We address these questions below, chapter by chapter.
Chapter 2: Skilled Worker salary thresholds
We recommend that occupation-specific thresholds for the SW route are set at a level which reduces the risk of undercutting domestic workers, without preventing certain jobs within occupations from using the system and inadvertently prioritising lower paid workers. Given this, we argue that the median is too high a level for occupational thresholds. We echo the recommendation we have made several times in the past that the 25th percentile of occupational earnings is adequate for this purpose. A reduction in the occupation-specific thresholds does not necessarily mean liberalising overall skilled work migration or increasing net migration, because the impact of these thresholds depends on the level of the general threshold.
As outlined in Chapter 2, the general threshold should be set to achieve the appropriate balance between the overall policy objectives of the government.
Of the options we present, maintaining the general threshold at £41,700 would maximise fiscal benefits, help ensure that Industrial Strategy sectors could recruit the workers they will likely need over the coming years, and reflect variation in wages across the UK. This is our recommendation.
Increasing the general threshold to £48,400 would result in the effective threshold rising for the majority of occupations. Combined with occupation-specific thresholds being set at the 25th percentile, it would broadly replicate the current set of thresholds in terms of the impact on net migration and fiscal contribution (and could feasibly lead to a small fall in net migration with some fiscal benefits) but would overall be less fiscally positive than if it were set at £41,700.
We continue to recommend that salary thresholds for work routes should be set at the UK-wide level and highlight that lowering occupation-specific thresholds to the 25th percentile would be more affordable for employers outside of London. Wages vary far more within regions than across regions, so even if thresholds were set at a regional level there would still be many areas of the UK that would struggle to meet them. Regional salary thresholds would also add complexity and may be harder to enforce within the migration system.
Salary requirements should be updated on a scheduled annual basis. This will ensure changes are regular, more predictable, and better aligned with evolving labour market conditions. Further detail is available in Chapter 2.
To note, much of the analysis in this report was carried out using ASHE 2024 data. Any updates to the Immigration Rules by the Home Office should be carried out using ASHE 2025.
Chapter 3: Discounts on Skilled Worker salary thresholds
New entrant discount
We recommend that a single new entrant rate be set at £33,400, to ensure a typical graduate entrant can be employed using the immigration system whilst also being sufficiently paid to provide a net fiscal benefit to the UK over their lifetime.
We recommend that the duration of this discount should change from its current length of four years but also recognise that the duration of the discount may interact with settlement policy. We therefore simply lay out how long, in theory, the discount is needed for workers to catch up with undiscounted thresholds; these durations should not be taken as recommendations for routes to settlement:
• If the occupation-specific threshold is set at the 25th percentile and the general threshold is £41,700 for the SW route, the valid discount period for new entrants would be six years.
• If the 25th percentile is maintained but the general threshold is increased to £48,400, the discount period would extend to nine years.
• If the occupation-specific threshold is set at the median and the general threshold is £41,700, the discount period would be 13 years.
• If the median is maintained but the general threshold is increased to £48,400, the discount period would extend to 16 years.
We note that very long new entrant discounts, which are required for higher undiscounted thresholds, may be undesirable; in particular, it is not feasible to taper the discount gradually over time, which means that workers in the final years of a long discount period could be underpaid.
We also recommend that the discount should be available to use for its full duration, independently of the length of time that the initial visa was granted for.
PhD discount
There was no substantial evidence to suggest that PhD holders receive lower pay than the average Skilled Worker and require a discount. We disagree that workers with a PhD should be expected to earn less than the average worker across their working life. We therefore recommend abolishing the PhD discount.
Postdoctoral discount
The MAC has never recommended a postdoctoral discount. However, there are legitimate arguments for this discount to support the research base in the UK – noting that many of the jobs will be in Industrial Strategy sectors. It is also likely, though, that other sectors will make similarly compelling arguments for other occupations that pay less than the occupation average. If the government wishes to maintain a discount for postdoctoral positions, we suggest setting the discounted salary at £41,700 for four years.
If the government chooses to accept our recommended salary thresholds for the SW route, whereby the general threshold would continue to be set at £41,700 and occupation-specific thresholds at the 25th percentile, then a postdoctoral salary threshold would align with the undiscounted thresholds and thus would not be required.
Chapter 4: Salary thresholds for other visa routes
Temporary Shortage List (TSL)
We recommend that the general threshold for the TSL should be set at least as high as the 30th percentile of the UK's full-time annual earnings distribution (approx. £30,900), ensuring migrants are paid a wage that affords a reasonable standard of living. If the government wants to keep use of the route low, it could choose a higher threshold, such as one close to the interim TSL's threshold of £41,700, but this would potentially restrict growth in Industrial Strategy sectors.
This recommendation is made on the basis that the TSL will not provide a path to settlement for route users. If the government decides the route should provide a path to settlement, then the general threshold may need to be reconsidered to ensure it is set at a level to ensure that users make a net positive fiscal contribution to the UK over their lifetimes.
The occupation-specific thresholds should be set at the median of each eligible occupation's full-time annual earnings distribution.
Global Business Mobility (GBM) route
• Senior or Specialist route: The general threshold should continue to be set at the median of the full-time annual earnings distribution of eligible occupations. The occupation-specific thresholds should be set at the median of each eligible occupation's full-time annual earnings distribution. The current occupation-specific thresholds, which are set at the 25th percentile, are too low to reflect the seniority of the route. The median is more appropriate to ensure that the workers are genuinely senior or specialist.
• Graduate Trainee route: A single salary threshold should be set at £33,400, mirroring the SW new entrant threshold. Due to lack of data demonstrating graduate starting salaries by occupation, we are unable to recommend occupation-specific rates and conclude they should be abolished.
• UK Expansion Worker route: The general threshold should continue to be set at the median of the full-time annual earnings distribution of the route's eligible occupations. Occupation-specific thresholds should be set at the median of each eligible occupation's full-time annual earnings distribution.
Pay scale occupations and standard H&CW occupations
The general threshold for pay scale occupations should be set at the level equivalent to Band 5 in the lowest paying UK nation, ensuring that healthcare and education occupations can be recruited in the same way across England, Northern Ireland, Scotland, and Wales. Occupation-specific thresholds should remain aligned with the relevant pay bands for each occupation.
For standard occupations, those not paid according to national pay scales, thresholds should be set using the same methods as the SW route. However, transitional arrangements should ensure that workers already in the UK in RQF 3–5 jobs are not accidentally required to leave. In the case of biomedical scientists, if the government wishes to allow the NHS to use the immigration system to recruit them by being paid according to the national pay scales, it will either need to restrict the use of the pay scale threshold for NHS employers or accept that private-sector employers will also be able to hire workers at relatively low levels of pay.
Scale-up
Salary thresholds for the Scale-up route should be aligned with those for the SW route. We make this recommendation with the knowledge that it will remove the main incentive for employers to choose this route over the SW route. The Home Office incurs non-trivial administrative costs setting up routes, and when subsequent visa uptake is low, as has been the case for the Scale-up route, they are very unlikely to have delivered value for money for taxpayers. We do not think it would make much difference if the route were abolished. We also recommend that the government avoid setting up similar routes unless there is a clear gap in the immigration system.
Other considerations
To better understand how employers use discounts, the Home Office's Certificate of Sponsorship (CoS) data should include if an individual is using a discount, and, if possible, where they are eligible for one but do not use it. This information (certainly the former) will be collected by Home Office case workers but is not made available in the microdata, making it necessary for us to create our own proxies for discount usage. There are other limitations of the CoS data which impeded our analysis, such as the 'size of business' variable being unreliable, which would be useful to address.
Recommendation: The Home Office should ensure that data on discounts and the size of the business be recorded accurately in CoS data in a form that allows statistical analysis.
We also note the recent announcement from the ONS that is set to pause the current version of the Annual Population Survey. While we recognise the issues the ONS has faced administering the survey since 2020, as is clear from the analysis in this report, we often rely on these data for occupation-level analysis. We would like to be consulted on future changes to it and other products such as the Transformed Labour Force Survey.
Separately, as part of our engagement for this commission, we spoke to many employers who regularly use the Skilled Worker route. Several of these employers highlighted uncertainty over their legal obligations to recruit candidates who require sponsorship compared to domestic candidates.
In our discussions, it became clear that many sponsor licence holders remain concerned, despite their best intentions to comply with all regulations, that they could fall foul of employment and equality laws if they do not hire someone because that person requires a visa. The government should consider clarifying (either in guidance or regulations, as necessary), that employers are not obliged to sponsor and can choose to prioritise candidates who do not require sponsorship.