Whether Brexit or Bremain is your choice for the EU Referendum on 23 June, uncertainty is what we’re currently facing as business owners and indeed recruiters. The to and fro of the arguments for and against may be turning business owners away from the debate, but it is important to consider what impact this could have on their companies.
Scouring media headlines there are polls which suggest many recruitment businesses are in favour of remaining in the UK, but almost as many are undecided. Although any decision will have a lead time before the implications and the situation to unwind, the choices made now or during voting need to be considered.
As the implications of a UK exit from the EU gain momentum, more facts and figures are surfacing:
- £229bn currently traded with the EU – how will this change if we exit?*
- The UK’s working population is 31.4m with roughly 16% of which are non-UK workers. Among them are 2.1m EU nationals who could become ineligible to automatically continue to work here.*
- In London one in eight of all employees is from the EU, a reliance that is particularly seen in the East and South as well as with employers in Northern Ireland. **
- Those from the EU have a higher employment rate, and are more likely to work full time.**
- EU employees represent a high proportion of workers in elementary occupations (those jobs without requirement for formal qualifications), however EU employees also represent 5% of all professional and managerial positions, supported by higher levels of education than UK-born employees. **
What are the consequences?
The impact on the UK economy includes reservations over future investments in UK industries from outside of the EU, particularly from the US. In open letters from the President, as well as leading large employers, to the Prime Minister, the need for ‘unrestricted access to the European market’ is a clear call for action: should Britain exit, there could be a limbo state for thousands of businesses in which the uncertainty begins to take hold.
There is an argument from the Brexit campaign that EU nationals working in the UK would be protected should we exit, and a deal would be agreed for the UK to become a non-EU member of the EEA (European Economic Area. Of course the Bremain campaigners counter claim there is no certainty in this deal.
Additional red tape and new work permits could have a knock on affect for the ‘time-to-hire’ process, therefore adding to recruitment costs, both for EU and UK employers. Many of the UK’s largest employers warn that it could not only be the employees who leave the UK but also the companies.
This would affect skill shortages in the UK which is something the recruitment industry is already all too aware of. At a point where more employers are in a position to recruit, any effect on potential recruitment/hiring prospects would be damaging to the prosperity of the UK and of the recruitment industry.
Whichever your view, in or out, it can be agreed that this is unchartered territory for all businesses. We, at UHY, can already see the impact it has had on the recruitment sector with permanent recruitment slowing down leading up to the referendum on 23 June. There are still a great many unknowns to how either decision would work out. After all the speculation, it’s another obstacle that the sector may have to overcome.
*Figures as stated by Ian Knowlson, Recruitment Training Group, on behalf of Recruitment International
** Findings from Working together: European workers in the UK economy, Social Market Foundation (SMF) in partnership with Adecco Group UK.