If there is one thing the current British government can claim to understand with absolute certainty it is the laws of supply and demand. This is perhaps most obvious when it comes to their administration of the immigration rules concerning Tier 2 visas for non- EU workers hoping to work in the UK, and for those employers obliged to recruit from beyond the EU.

The announcement of a new levy on migrant workers, in addition to a general ‘tightening up’ of the application and administration of the tier 2 visa scheme, including a seemingly enthusiastic campaign to impose Tier 2 suspensions, has been widely condemned.

The new Immigration Skills Levy, which will effectively tax Tier 2 employers of every worker they hire, will only add to the existing complaints that the government’s stance on the immigration of skilled workers is harming various important sectors of the UK. The health Service and the legal profession have both been identified as areas in dire need of such labour.

Employers are being steered with what many are calling a ‘heavy hand’ in the direction of resident UK workers rather than migrant labour. Given that in many industries and professions, including those already mentioned, the requisite skills are in short supply domestically, the government appears to be painting itself into a corner. Employers are already obliged to pay £200 for every worker and family dependent for every year of their stay in the UK.

In its enthusiasm to limit immigration numbers the government’s enthusiastic crack down on migrants - including the energetic campaign by UKBA to impose Tier 2 suspensions on the slightest grounds - is restricting the UK economy’s economic competitiveness. Objections to the government stance from professional bodies, health service spokesmen and women and the CBI are seemingly ignored.

The heavy handed imposition of yet another economic disincentive to recruit on a Tier 2 basis suggests that whilst government understands the crude mechanics of supply and demand, it may be less well attuned to the bigger picture.