The immigration plans as proposed by the government today will dramatically affect the labour market. Our report Ready, Willing, and Able found that the UK is not currently able to replace EU workers with UK nationals and robots in lower-skilled roles. Shortages of labour in these roles will lead to companies reducing output, closing, or moving overseas, damaging the UK economy. Skills and staff shortages are already one of the biggest challenges facing the UK economy, predating Brexit.
Roles in sectors as diverse as social care, hospitality and construction, across skill levels are hard to fill, which is why the UK needs an evidence-based immigration policy that reflects the needs of employers including our public services. It is disappointing that the government seems to have reverted to talking about immigration numbers.
Jobs the government considers ‘low-skilled’ are vital to wellbeing and business growth. The announcement threatens to shut out the people we need to provide services the public rely on.
The UK needs access to workers that can help us look after the elderly, build homes and keep the economy strong. We believe a temporary visa route to respond quickly to peaks in demand would help ensure this.
Finally we are concerned by the unintended consequences of these changes to the labour market. On the one hand, they threaten the flexibility of our entrepreneurial labour market. Seasonal work is not just confined to the agricultural sector but can be found in hospitality, logistics and retail, with holiday seasons and heatwaves impacting on need for workers in different sectors. Secondly, without the necessary workers, unscrupulous business may turn to the illegal workforce.
On youth mobility schemes
Whilst youth mobility schemes may be a partial solution, there are tight restrictions on who can come into the UK on these visas at the moment and opening up this scheme to EU workers will rely on future trade deals.
On illegal working and exploitation
We are also concerned that a post-Brexit labour shortage would increase the likelihood of illegal working and exploitation. In the US, more than half of farmworkers are unauthorized and 15% of construction workers. Nobody wants the UK to be in this position due to the lack of an official low-skilled immigration route.
Tier two changes/points-based system
It’s welcome to see the increased flexibility in the system – including a lower salary threshold of £25,600 with few exceptions, and the promise of a more robust system for the MAC to keep the shortage occupation list under regular review. However, this system is only designed for migrants offered permanent roles, rather than the whole labour market including temporary workers, contractors and the self-employed.