Skills shortages across health, education and construction are “starting to bite” as Brexit exacerbates issues companies have with filling vacancies.
Meanwhile, the UK’s construction industry, which makes up just six per cent of the UK economy but has huge knock-on effects for the rest of the country’s economic activity, has been paralyzed as lenders and firms wait to see if there will be a no-deal Brexit later this month.
Firms have also expressed concerns about being able to fill 168,000 construction jobs over the next five years.
The number of people coming to the UK for work has fallen to its lowest level since 2014 – this follows a fall in the number of EU citizens arriving to work.
More people are coming to the UK to study, with non-EU student immigration at its highest level since 2011.
In the year to September, a total of 627,000 people moved to the UK and 345,000 people left the UK – a net migration of 283,000.
Firms across the UK are reporting that they cannot get skilled workers because migrant workers are choosing not to move to the UK in the same numbers as before the Brexit vote.
This, many business groups have said, is leading to acute issues in certain sectors.
The construction sector has contracted below the benchmark Purchase Managers’ Index of 50 for the first time in 11 months – when snow storms halted work – as projects were delayed because of Brexit uncertainty.
The IHS Markit/CIPS construction purchasing managers index for February fell to 49.5 from 50.6 the previous month. But the UK’s housing sector did show modest growth buoyed by the government’s Help to Buy scheme, a chronic shortage of homes and low interest rates.
The construction industry also said it is experiencing some of the longest delays in getting materials since 2015, owing to transport shortages caused by manufacturers stocking up on materials in case a no-deal Brexit disrupts imports.
According to the Office for National Statistics, net migration to the UK from the European Union has hit its lowest level since 2009.
Meanwhile, net migration from non-EU citizens to the UK – 261,000 more – was at its highest since 2004. The figures are the last set before the UK is due to leave the EU on the 29th March.
In December, Prime Minister Theresa May said her government is sticking to its longstanding ambition to bring net migration down to the “tens of thousands”.
Tom Hadley, Director of Policy at recruitment group Statistics, Recruitment and Employment Confederation, said that UK firms across different sectors are already struggling to fill vacancies.
“Providing workers from the EU with clarity on what their future working opportunities and rights will look like is a huge priority,” he said. “Brexit uncertainty, with a lack of clarity on what no deal means for EU citizens working here, coupled with a weak pound is making the UK less attractive to workers from the EU27.
Overall, net migration, immigration and emigration figures have remained broadly stable since the end of 2016, the ONS said.
The report also showed that more citizens from Central and Eastern European countries known as the EU8 – which includes Poland, Slovakia and Lithuania – are leaving the UK than arriving.
Labour’s Shadow Home Secretary Diane Abbott said: “The data simply confirms the fakery behind the government’s immigration policy. Once again, the number of migrants coming here vastly outstrips its unworkable 100,000 net migration target.
“Its policy is not really about reducing numbers, but allows it to maintain a constant campaign against migration and migrants.”
Jonathan Boys, an economist at the Chartered Institute of Personnel and Development, the professional body for HR and people development, said:
“The figures highlight the need for the post-Brexit immigration system for EU nationals to be as low cost and user-friendly as possible for both employers and individuals.
“With record high employment and the effect of skills shortages starting to bite, the government needs to be in full listening mode in its consultation with employers over the proposals in the immigration white paper, to ensure that businesses are able to continue to access the skilled and unskilled workers they need from the EU post Brexit.”
A coalition of construction industry organisations called on the British government for ‘breathing space’ to allow it access to overseas workers after Brexit.
ItS paper Building After Brexit: An Action Plan for Industry details what it says are the specific steps the industry, government and the CITB must take to lessen the impact of Brexit.
Chief executive of the Federation of Master Builders Brian Berry said the skills shortage is “the single biggest issue keeping construction employers awake at night” adding that “the UK construction sector can’t satisfy its thirst for skilled labour via domestic workers alone…we’ll always need a significant number of migrant workers too – particularly in London and the South East.
‘The Government needs to amend its Immigration White Paper and rethink the current definition of low-skilled workers.’