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Skills shortage fears over post-Brexit immigration

UK manufacturers and suppliers have expressed alarm about the uncertainty created by government plans for a new post-Brexit immigration regime and the possibility of a skills shortage.

Following the UK’s departure from the European Union, the government proposed to introduce a new points-based system for introduction as early as January 2021. Last year it commissioned the Migration Advisory Committee (MAC) to assess such a regime and also to review the salary thresholds for entry.

The MAC reported its recommendations yesterday. It suggested the minimum salary threshold of £30,000 should fall to £25,600 for all workers and advised against a points-based system.

A Home Office spokeswoman could not say whether the government would adopt the recommendations, but clarified: “We will deliver on the people’s priorities by introducing a points-based immigration system from 2021 to attract the brightest and best talent from around the world, while reducing low-skilled migration and bringing overall numbers down.

“This firmer and fairer system will let us decide who comes to this country based on their skills and the contribution they can make – not where they come from. We will continue to speak with businesses of all sizes as the system is designed and rolled out.”

The report follows a letter written last week by lobby groups including the UK Fashion and Textile Association, Confederation of British Industry, British Chambers of Commerce and Federation of Small Businesses, to home secretary Priti Patel setting out four priorities for a new regime, support for a drop in salary threshold and calling for the scrapping of the net migration target

Industry lobby groups’ four priorities

  • flexibility for skilled workers to enter the UK through a points-based system
  • a temporary visa route for all sectors
  • a minimum salary threshold set at a level that supports the economy
  • and a “radically reformed” sponsorship process.

Fashion retail business leaders expressed concern about the new post-Brexit uncertainty and implementation of any new regime. 

“Whether you are a large or a small business, suddenly finding you can no longer access the skills you need will cause very significant disruption,” said Simon Cotton, CEO of Johnstons of Elgin. “I would hope the government will do all it can to minimise the shock to businesses and employees, and give everyone time to understand and prepare for whatever new system emerges.

“I very much appreciate that our industry bodies are singing the same song in approaching the government on this issue.

“If we want to have a thriving textile sector in the future, the ability to quickly bring people into the UK with key skills, without too much cost or bureaucracy is essential. If we do not achieve this, UK manufacturers will be forced to scale down according to the local skills availability, limiting the long-term prospects for people in the UK.”

Mike Cherry, national chairman of the Federation of Small Businesses, agreed: “A lot of firms will be concerned about the timetable for the new system. The government promised that changes will be introduced in a ‘phased way’ to give small businesses time to prepare – now there are fears it will be sprung on us at the drop of a hat.”

Meanwhile, industry sources said a system change could give the industry the chance to grow, as it would enable more skilled workers to enter the UK. 

One footwear supplier said: “Across the industry, it is well known that British people don’t want to do some of the unskilled and skilled jobs in manufacturing. Companies have been able to survive by migrants coming into the UK and taking up those roles.

“I welcome any changes that allow the UK to bring in more people interested and skilled in those jobs.”

He added: “It is a concern that businesses will have to adapt to these changes fairly quickly now that Brexit has been shoehorned in, but everyone has known about these potential changes for a while now. Everyone will also be on a level playing field.”

Kate Hills, founder of manufacturing trade show Make It British, said: The biggest shortage of staff in the UK is garment manufacturers and machinists, and other roles within the textile industry. 

“One of the main issues is that government doesn’t understand what the roles look like. There needs to be a clearer definition of what there is a shortage of, in terms of roles. They need to not base it on salary, but on skills. The value they can add to the economy is what the government should be looking at.

“A system change will give the industry the chance to grow, which it needs and wants to do. It has not been able to grow because of the lack of available skilled staff. It needs to happen very quickly as we can’t train people fast enough.”

Cherry agreed that the system should not be based on salary: “The £30,000 figure has to be looked at again, and a more sensible threshold of £20,100 rolled out for skilled workers. Certain sectors, not least construction, manufacturing and IT, will be hit particularly hard if the current proposals are implemented unchanged.”

British Chambers of Commerce head of people policy Jane Gratton said: “While companies are investing more in homegrown skills, they will continue to need access to migrant skills at all levels.

“A flexible and supported transition to new arrangements will be essential if businesses are to thrive.”

 

 

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