Migrant workers will have to earn at least £35,000 a year if they want to stay in the UK for longer than five years, according to Home Office rules announced on Wednesday.

Independent migration advisers have forecast that the move will slash the number of economic migrants and their dependants granted settlement by 40,000 a year. But since it will apply only to those seeking settlement from April 2016 onwards, it will not contribute to the government’s pressing target to cut net migration from the current level of 250,000 to the “tens of thousands” by 2015.

Damian Green, immigration minister, had already said he wanted to break the so-called “automatic link” between coming to the UK for a particular job and staying here permanently. Under the new system, only migrants whose professions are listed under the official shortage occupation list, which includes various types of engineers, nurses and geologists, will be able to avoid the minimum £35,000 salary. In order to minimise the effect on universities, scientists and researchers in PhD-level jobs will also be exempt from it.

Announcing the policy on Wednesday, Mr Green said that settlement in the UK was a “privilege”.

“We are sweeping aside the idea that everyone who comes here to work can settle and instead reserving this important right only for the brightest and best,” the immigration minister said.

“Our reforms of the immigration system will ensure we are more selective not only about those who are allowed to come here but also those who are allowed to stay permanently.”

However, Matt Cavanagh, associate director for UK migration policy at the Institute for Public Policy Research, a think-tank, said the changes made “no sense” in economic terms.

“It could also discourage the ‘brightest and best’ from coming here in the first place: the majority of working migrants don’t stay permanently anyway, but they value the option, and if Britain no longer offers it, they may go elsewhere,” Mr Cavanagh said. He added that guest worker policies were “notoriously unworkable”.

One development likely to be welcomed by business is that visitors coming to the UK for specific paid professional engagements such as lectures or performances will now be able to come for up to a month without the need for sponsorship by a UK employer. This will reduce bureaucracy for those coming only for a short stay.

Caron Pope, managing partner at the law firm Fragomen, said the announcements showed that the Home Office was listening to business, but called for a break in the ongoing “consultation fatigue”.

“Since the election we have seen half a dozen reviews and reforms of work permit policy. What we really need is a chance for the system to bed in,” she said.

Meanwhile, Dr Wendy Piatt, director-general of the Russell Group of universities, welcomed the pay threshold exemption for researchers and said that academics in the early stages of their career would now come to the UK “safe in the knowledge” that they can stay. “Today’s junior researchers could be tomorrow’s Nobel Prize winners,” she said.

But even if the new policies do help the government efforts to meet their net migration target, Oxford university’s Migration Observatory published new research on Wednesday predicting that any short-term suppression of immigrant inflows would be reversed by a “bounce” later on.

The research showed that cuts to migrant groups such as students, who tend not to settle long term, might appear dramatic initially but would result in rising net migration further down the line because emigration decreases.

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