Majority of UK business still not budgeting for post-Brexit immigration

Despite a possible exit date looming, the majority of UK businesses are unprepared for recruiting talent in a post-Brexit world, new research reveals.

Faced with the prospect of access to EU skills and labour curtailed, research conducted by law firm, Shakespeare Martineau, has found that 76% of UK mid-market businesses have no funds in place for post-Brexit immigration and 41% of businesses have already experienced a decrease in talent and skills since March 2017.

The survey, conducted with 132 decision makers in UK businesses, shows the effects of Brexit are already affecting HR and recruiting strategies. Since the triggering of Article 50 on 29 March 2017, one third (33%) of businesses said they had already experienced a decrease in the number of workers coming to the UK, and more than a quarter (26%) said they had already recruited fewer EU workers into their organisation.

The prospect of no longer having unfettered access to EU talent means that businesses will have to look towards other international labour pools. However, this does come at a cost and currently, the cost of recruiting someone on a Tier 2 visa for a three-year contract in the UK is over £5,000 per person. This includes costs for application fees, immigration healthcare charges and immigration skills charges. If the worker wanted to bring their spouse and two children, this sum rises to approximately £11,000.

Tijen Ahmet, head of business immigration at law firm, Shakespeare Martineau, said: “We are now so close to having a decision finalised – whatever it may be – about the UK’s future relationship with the EU and despite evidence that many businesses have felt pressure on their recruitment channels so far, there appears to be inaction within the marketplace.

“The UK has enjoyed access to EU labour for so long and once that tap is turned off, many organisations will find themselves faced with a hole in their recruitment strategy. Exploring other global talent markets is going to be increasingly important, however this comes at a price. The current Tier 2 visa system for skilled workers is expensive and if employers find they need to use this system to plug gaps in their businesses, the costs could soon climb.”

The survey results also show that many UK businesses are burying their heads in the sand when it comes to assessing how Brexit will affect their workforce. More than a quarter (27%) of organisations surveyed said they had yet to analyse the impact of immigration changes on their HR and recruitment strategies going forward.

Tijen Ahmet, continued: “Immigration has been one of the fiercest Brexit battlegrounds so far, but at least we now have some clarity about what the future system will look like, and how it will function. It’s positive that EU migrants and their families who are already here will be able to stay – providing they apply under the new EU Settlement Scheme – but many will already be leaving and businesses must prepare.

“The first vital step is undertaking an audit to understand the makeup of the workforce, understanding which people will be affected and how. After gaining that insight, plans can be put in place to help plug talent gaps which might spring up in future. If this involves recruiting from other non-EU geographies, careful thought must be given to how to get individuals over to the UK and the costs must be picked up by employers along the way.”

To see the full report, click here.

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