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How will Brexit affect recruitment?

Published: Wednesday 5th April 2017

Cracked eggshell one half European flag, other half union jack

Results from a YouGov survey for the Mental Health Foundation showed that 49% of respondents had some kind of anxiety about the future of the UK after its EU exit. This is one of the biggest social and economic events to happen in our lifetime. Formal exit negotiations have now started and the lack of certainty is apparent. Not knowing what the future discussions may hold is understandably causing uncertainty in the UK economy, which has repercussions for business confidence and ultimately recruitment.

Unfortunately, this doesn’t seem too long after the credit crunch, which seriously affected the recruitment businesses with staffing freezes and redundancies. We have been making positive moves forward in the decade since 2007, however, we don’t yet know the extent to which Brexit will affect the recruitment industry. There are already some concerns, both for recruiters and businesses, and we explore some of the likely contentious areas in this article.

Free Movement

As a member of the EU there is free movement between countries. We have been increasingly reliant on this labour source and we are now in a position where migrant workers underpin certain key sectors. Drivers, carers, construction, cleaners, the food manufacturing and harvesting sectors are just some cases in point where importing flexible migrant workers have filled the manpower shortage. Equally the specialist skills shortage in IT and engineering sectors have also looked to Europe to fill their gaps.
When the decision was made to leave the EU, a staggering 100,000 EU citizens departed from the UK within 3 months. New workers from Poland, Hungry and Slovakia also saw drops of 16%, 14% and 20% respectively.
Whichever free movement policy is ultimately negotiated, Norway: relatively open, vs Switzerland: more restricted, upheaval is inevitable. As a result this will effect the number and quality of candidates recruiters have access to.

Realignment in recruiting strategy

Faced with a potential reduction in migrant labour, it is apparent that we will need to look to a different source, or approach, to fill the need. While automation is becoming more prevalent in various sectors a fully automated future is still a long way off. We have historically had problems with attracting and retaining key non-skilled workers. How do we re-engage with our ‘indigenous’ pool of potential workers?
Are apprenticeships a potential way to bring new skills to the market? ‘Earning while learning’ attracted 500,000 people in 2016. With an ongoing commitment to increase apprenticeships (UK Government pledge to create 3 million apprentices by 2020) for skilled careers, this could be one solution.
A bigger problem may be how to entice lower paid, lower skilled staff into employment. Will changes in labour law and benefits structures make zero hour contracts and menial jobs less of a stigma? Or will changes be forced upon employers to strengthen their offer to attract candidates.

Workers’ Rights

Current EU legislation on workers rights is due to be imported wholesale into British law. Although there will be amendments made in the future, it is likely that the majority of existing policies will remain unchanged in the short term. This could be an opportunity for the UK to forge ahead with a radical new approach to employment law embracing work-life balance, equality in the workplace and social inclusivity.

Conclusion

Although Brexit is highly likely to affect recruitment, the question is how. As recruiters we need to begin to prepare for 2019. There is still plenty of time to focus on our goals and map out our approach.
We would love to know your opinion about anything in this article and how it resonates with you. Have you already noticed a difference since the exit was announced – either in a positive or negative way? What do you think the future has in store for recruitment? Discuss on our LinkedIn Specialist Recruiters Group.

Sources:
http://www.independent.co.uk/voices/eu-brexit-trade-unions-employment-rights-recruitment-a7661846.html
http://www.independent.co.uk/news/business/news/brexit-latest-news-uk-businesses-recruitment-crisis-polish-workers-return-home-immigration-eu-a7596956.html
https://medicalxpress.com/news/2017-02-brexit-trump-britons-anxious.html
http://www.independent.co.uk/student/career-planning/eu-referendum-brexit-leave-remain-graduate-employment-job-recruitment-cut-a7097311.html
https://www.theguardian.com/business/2016/sep/01/hays-drop-hiring-brexit-vote-eu-referendum-banks-recruitment
https://rprox.zoek.uk/blog/apprenticeships-learn-while-you-earn

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