The chief executive of the world’s largest advertising agency has said that the UK needs skilled immigrants to provide the staff for many different sectors of the economy including the technology sector.
Sir Martin Sorrell, CEO of WPP, says the UK needs an enlightened approach to policy in order to produce talent of its own of the calibre of Sergey Brin, (co-founder of Google), Andy Grove (co-founder of Intel) and Elon Musk (co-founder of PayPal and SpaceX).
Sir Martin was born in London in 1945 and, after working for UK advertising giant Saatchi and Saatchi, took over as chief executive of WPP in 1985. WPP was then a small UK manufacturer of shopping baskets called Wire and Plastic Products Plc. It is now an advertising agency worth $5bn, employing 140,000 people in 2,400 offices in 107 countries.
The Cambridge and Harvard graduate says that UK firms are having trouble in getting visas for the skilled international workers they need. He said: “Although recruiting from countries within the EU is relatively easy, bringing in highly skilled people from outside the region is not, as we at WPP can testify”.
UK and US damaged by restrictions
Sir Martin says that the UK and the US are being damaged by their restrictive immigration policies particularly in the IT sector. In his opinion, immigrants bring much needed entrepreneurialism and talent to the sector. He quotes the result of a survey of 34 start-up companies in the ‘Silicon Roundabout’ area of London (where much of the IT sector is concentrated), which found that 25% were founded by foreign-born entrepreneurs.
He adds that research in the US shows that a quarter of all engineering and technology companies founded between 2006 and 2012 had at least one foreign-born founder. These businesses had revenues of $63bn in 2012 and employed 560,000 people.
“42% of America’s Fortune 500 companies were founded by first or second-generation immigrants and those businesses have created over 10m jobs and $4.5trillion of annual revenue (30% of US GDP),” he said.
Sir Martin says that he also has personal reasons for favouring immigration. His own grandparents arrived in the UK from different countries in Eastern Europe in about 1900. Sir Martin would probably not have been born at all if they had not been able to migrate and meet in the UK. Under today’s points system, they almost certainly wouldn’t have been granted entry to the country.
He says: “Earlier this year I visited Poland and Ukraine, meeting a number of our people and clients. As ever I was stimulated by the energy, desire and sheer entrepreneurial zeal on show in these increasingly important, fast-growing markets.
“The trip also had more personal significance. My grandparents came to London from Eastern Europe (my father’s parents were from Ukraine and my mother’s from Poland and Romania – the first arriving in England around the turn of the 20th century) and I flatter myself to think that I’ve inherited some of the drive that built a new life in an unfamiliar city far from home.
“My paternal grandparents and their four witnesses had to sign their marriage registration with a cross because they didn’t speak English, and under today’s points system they almost certainly wouldn’t have been granted entry to the country. Had that been the case, my life would have been very different, and I probably wouldn’t be here in the UK now (not everyone would see that as a problem!).
“I wouldn’t have been a Sorrell (my father changed our family name), I wouldn’t have had the educational and other advantages of growing up in Great Britain, I wouldn’t have had the same career opportunities and I wouldn’t have founded WPP.
“So I have an instinctive dislike of some of the current rhetoric – both in the UK and elsewhere – about immigration. But my objections go beyond the personal.
“There is much discussion, often emotional, on the overall economic impact of immigration. I’m not going to focus on that, although I think it’s interesting that independent bodies like the Institute for Fiscal Studies say that Central and Eastern European migrants to the UK before the financial crisis delivered a net benefit for the economy, and that the OECD recently concluded that immigration into the world’s leading economies has not proved a drain on public finances.
“What is certain, and all too often lost in the noise of the debate, is that immigrants are a hugely important driver of innovation and entrepreneurialism – traits that spur economic growth.
“Look at the vital technology sector. A survey by Management Today magazine found that, from a sample of 34 companies in the ‘Silicon Roundabout’ area of London, at least a quarter of the founders were foreign-born.
“It’s a similar story in the US. The Kauffman Foundation of Entrepreneurship discovered that of all the engineering and technology companies founded in the USA between 2006 and 2012, nearly a quarter had at least one key founder who was foreign-born. In Silicon Valley, the figure was well over 40%.
“Across the US, these businesses had revenues of $63 billion and employed some 560,000 people in 2012.
“Earlier this year the celebrated trend-watcher Mary Meeker produced a characteristically insightful presentation, which skilfully argues the case for immigration reform in the US.
“Having pointed out that 42% of America’s Fortune 500 companies were founded by first- or second-generation immigrants, and that those businesses have created over 10 million jobs and $4.5 trillion of annual revenue (equivalent to 30% of US GDP), she moves specifically to the tech industry.
“According to Meeker’s deck, 60% of the top 25 US tech companies were founded by first-or second-generation immigrants, including Apple, Google, IBM, Oracle, Amazon, eBay, Facebook, Yahoo! and LinkedIn.
“And then to the problem (for the US at least – for other countries it’s a great opportunity). By 2020, says Meeker, US businesses will need to hire more than 120,000 people every year for roles that require a computer science degree. The number of home-grown computer science graduates will be less than half that.
“Current policy makes it difficult for highly skilled foreign graduates educated at American universities to remain in the US, and visa restrictions make it impossible to bring in sufficient numbers of highly skilled workers from overseas. Net result: a shortage of talent makes the US tech sector less competitive, the economy suffers and jobs move abroad.
“Companies in the UK face the same problem. Although recruiting from countries within the European Union is relatively easy (one of many reasons to maintain UK membership), bringing in highly skilled people from outside the region is not – as we at WPP can testify. Moves to restrict immigration further make it even more difficult.
“This is a major hurdle for businesses looking to grow fast. As Management Today puts it in its article about London’s tech scene, ‘political pressure to cut immigration threatens to kill off the goose that lays the start-up egg’.
“Other sectors are undermined, too. The university system is one of our national assets, enabling us to build relationships with fast-growing markets. Both the CBI (Confederation of British Industry) and the Mayor of London Boris Johnson have warned of the potential damage to the UK’s £15 billion-a-year higher education market of unduly restrictive immigration policy.
“When, in an impressive display of unity, Silicon Valley leaders wrote to the US Senate in June in support of immigration reform, they said: ‘our success stems from our historic diversity, and the constant infusion of new and innovative ideas’. I agree – and those words apply equally to WPP. Moving talented people across borders within our global group, and attracting talent from all over the world, has been an important component of our own success.
“If the US wants more Sergey Brins, Andy Groves and Elon Musks, and the UK wants some of its own, there needs to be an enlightened approach to policy. There are genuine concerns about the cultural, financial and social consequences of immigration. The debate must be had, but let’s not cut off this lifeblood and everything we gain from it.”
