London firms warn proposed immigration rules risk £7bn economic setback

A significant majority of London-based firms have voiced opposition to the UK government’s recent immigration proposals, citing concerns over the potential adverse effects on economic growth and business operations. The government’s white paper, unveiled in July, outlined plans to tighten immigration controls by increasing the salary threshold for skilled worker visas and raising application costs. However, according to a survey conducted by the London Chamber of Commerce and Industry (LCCI), only 14% of business leaders believe these measures would benefit the economy, while 81% emphasised the critical importance of access to international talent for London’s corporate landscape.

The LCCI’s findings highlight widespread anxiety over the proposed tougher restrictions, especially within the tech sector, which relies heavily on highly skilled migrants. The chamber noted that over a third of the UK’s fastest-growing companies have founders born outside Britain, underscoring the vital role of international talent in driving innovation and economic expansion. Karim Fatehi OBE, the LCCI’s chief executive, warned that curtailing access to skilled workers risks hampering growth, weakening London’s competitive edge, and ultimately damaging the city’s standing on the global stage. He urged the government to collaborate with the business community to create immigration policies that balance public concerns with sustainable economic development.

Beyond skilled visas, business leaders have also expressed concerns about the impact of restrictions on short-term worker visas. These are crucial for sectors such as hospitality, construction, and environmental services, which often face acute recruitment challenges. The LCCI has called for an increase in short-term worker visa allocations and for streamlining the business visa process to better support London’s diverse economy. Their quarterly economic survey revealed optimism among company executives about growth prospects and workforce expansion, emphasising that restrictive immigration rules could undermine this positive momentum.

The economic risks linked to tightening immigration controls are supported by research commissioned by the LCCI. A ComRes survey identified that more than half of London businesses believe a reduction in immigration would harm economic growth, with many favouring prioritising economic expansion even if it involves increasing immigration levels from EU countries. The LCCI’s report ‘Points, Permits and Visas’ projected that immigration limitations could lead to a £7 billion decline in economic output and a £2 billion shortfall in tax revenues by 2020.

London’s distinct needs have been particularly highlighted in response to the government’s proposal to set a £30,000 salary threshold for skilled workers. Industry leaders argue this threshold is too high and fails to reflect the wide range of skills necessary across various sectors, including the NHS, education, and care services. The LCCI advocates for a more flexible immigration system tailored specifically to London’s status as a global business hub. This position is echoed by a poll indicating strong support among London councillors, business leaders, and residents for the positive contributions immigration has made to the city’s economy over the last decade. The survey also underscored concerns about the complexity of current immigration rules, urging reforms to make the system more efficient.

A broader ongoing debate involves calls for devolving immigration decision-making power to London authorities. Recent polling commissioned by the LCCI shows that significant segments of the business community and public support allowing London to set its own immigration targets to better align with local economic needs. The chamber argues that such devolution would enable more nuanced, responsive policies that address London’s specific challenges post-Brexit, including skill shortages and recruitment difficulties in key sectors.

The LCCI has specifically appealed to Home Secretary Suella Braverman to take London’s unique circumstances into account during the current immigration review. It highlights that the complexity of immigration rules is hampering businesses’ ability to fill critical recruitment gaps, threatening sectors vital to the city’s economy. Advocates stress the importance of maintaining London’s global connectivity and competitive position by ensuring immigration policies support rather than constrain its economic prosperity.

In summary, London’s business leaders are united in their call for an immigration system that facilitates access to both skilled migrants and essential short-term workers, supports sustainable growth, and accommodates the city’s distinctive economic landscape. The prevailing message to government is clear: restrictive immigration policies risk undermining London’s economic future and its position on the global stage.

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Source: Noah Wire Services

Noah Fact Check Pro

The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.

Freshness check

Score:
8

Notes:
The narrative is recent, dated August 5, 2025. The London Chamber of Commerce and Industry (LCCI) released a press statement on July 31, 2025, expressing concerns over the government’s immigration white paper. ([londonchamber.co.uk](https://www.londonchamber.co.uk/news-insights/news/press-releases/london-chamber-reacts-to-the-immigration-white-paper/?utm_source=openai)) The UKTN article references this press release, indicating the content is fresh. However, similar concerns have been raised by London businesses in previous months, suggesting ongoing discussions on this topic. ([cityam.com](https://www.cityam.com/hard-line-immigration-policy-will-stifle-growth-in-the-capital-london-firms-warn-truss-and-sunak/?utm_source=openai))

Quotes check

Score:
7

Notes:
The article includes direct quotes from Karim Fatehi OBE, chief executive of LCCI, and references a report by the Entrepreneur’s Network. The Entrepreneur’s Network report is dated 2024, indicating the quote may be reused content. The LCCI’s press release from July 31, 2025, is the earliest known usage of Karim Fatehi OBE’s quote, suggesting the quote is original in this context. ([londonchamber.co.uk](https://www.londonchamber.co.uk/news-insights/news/press-releases/london-chamber-reacts-to-the-immigration-white-paper/?utm_source=openai))

Source reliability

Score:
6

Notes:
The narrative originates from UKTN, a technology news outlet. While it references a press release from the reputable London Chamber of Commerce and Industry, UKTN’s own credibility is less established, which may affect the overall reliability of the report. ([londonchamber.co.uk](https://www.londonchamber.co.uk/news-insights/news/press-releases/london-chamber-reacts-to-the-immigration-white-paper/?utm_source=openai))

Plausability check

Score:
8

Notes:
The concerns raised by London businesses regarding the government’s immigration proposals align with previous reports and statements from reputable sources, such as the Mayor of London and other business groups. ([london.gov.uk](https://www.london.gov.uk/press-releases/mayoral/mayor-reveals-risk-of-government-immigration-plans?utm_source=openai)) The narrative’s claims are plausible and consistent with ongoing discussions on this topic.

Overall assessment

Verdict (FAIL, OPEN, PASS): PASS

Confidence (LOW, MEDIUM, HIGH): MEDIUM

Summary:
The narrative is recent and addresses ongoing concerns from London businesses about the government’s immigration proposals. While the source’s reliability is moderate due to UKTN’s lesser-established credibility, the content’s plausibility is supported by consistent reports from other reputable entities. The use of a recent press release from the LCCI adds to the freshness and originality of the content.