HAS BREXIT IMPACTED THE RECRUITMENT WORLD?
Well, it wouldn’t be much of a blog if the answer was no, now would it!
In this time of uncertainty when the general economy is trying to find a stable footing in a shifting world, it’s inevitable that we are seeing some changes in the recruitment world.
Even in the run up to the referendum we were seeing a slowdown in hiring permanent staff and this trend is expected to continue. Employers are opting to hire contractors and temporary staff until things are a little clearer. Possible changes to employment law, restrictions on migrant workers, etc are all expected. Indeed, according to consultancy firm CEB, the number of job vacancies dropped by almost 700,000 in the week after Brexit, a 47% drop in job openings compared to last year.
At present all we have is still speculation but it’s looking increasingly likely that the following changes will result from Brexit:
- A restriction in the number of lower-skilled workers into the UK. The UK Labour Market report 2016 states that employers have chosen to use migrants because of their ready availability and the difficulty in attracting UK-born applicants for unskilled or semi-skilled roles. If the firms for whom you are recruiting have such job roles – typically in agriculture, construction, hospitality and catering – they may need to look at ways to incentivise the UK-born job-seekers, since UK unemployment is running at around 5%.
- Possible restriction in skilled migrant labour into the UK which would impact sectors such as IT and engineering. This could mean an opening for technical skills training becoming the next big thing.
- Reforms to Employment Law. It is generally accepted that many of the current employment legislation will, at the very least, be revisited, and quite possibly changed – Agency Worker’s Regulations, Right to Work, Working Time Directives are all likely to come under scrutiny. In particular the AWR and the WTD are seen as stifling flexibility and adding cost to a company’s recruitment bill.
- It remains to be seen whether there will be a skills drain towards Ireland or even further afield as employers seek to find stable recruitment options. Call centres for instance may choose to use staff in India (often more highly qualified than their UK counterparts) or manufacturing companies may outsource certain processes overseas to mitigate the higher cost of raw materials.
While accountants don’t have mystical powers to see in the future as to how the jobs market is going to evolve, they will be keeping track of changes that may affect your business. They will be able to advise on tax implications of moving any of your business overseas, and help with cashflow forecasts in the event of a change in your recruitment strategy. Talk to them and be guided by them as the situation changes as we head towards activation of Article 50.