Brexit: The Potential Impact on Recruitment
How the recruitment industry could be affected by the EU referendum.
Perhaps a knee-jerk reaction, but according to data from CEB, in the week before the referendum almost 1,500,000 jobs were advertised online. This figure dropped to under 820,000 in the following week and, although it’s unclear if the trend will continue, as with any challenge, the key is not to panic.
An awful lot has happened since the UK voted to leave the EU and, in the wake of such seismic change, an inevitable wave of uncertainty has swept across the business community.
While it may be difficult to see the immediate business benefits of the decision, in order to capitalise on the position we are in, we need to begin focussing on the things that are within our control, rather than those outside our scope of influence.
The reality is that no one can accurately predict the future, but neither can we hide from it. With this in mind, I thought I’d take a look at some of the potential changes we might see, both good and bad, in the recruitment industry as a result of our Brexit.
For companies using the UK as their European headquarters it seems unlikely they will continue to operate in the same way going forward, but this doesn’t mean automatic job cuts or relocations to the continent.
The UK is a huge market in its own right and we will be negotiating trade deals across the world, so in the short-term it is more likely that there will be a slow-down in employment growth in UK offices, with recruitment increasing in European bases.
Attracting Top European Talent
Concerns about rising levels of migration in the UK seem to have been among the key reasons many people voted to leave the EU, however the extent to which free movement of people will be effected will remain unclear until the government negotiates our exit.
Accounts from recruiters seem split on the immediate impact this has had on bringing top talent to Britain, with some saying businesses who rely on EU nationals are not seeing any recruitment issues, while others are reporting highly skilled people – such as doctors – are already choosing to go elsewhere.
EU Citizens working in Britain
Perhaps the biggest area of concern is what will happen to EU citizens already employed in Britain. In terms of the many laws affecting their recruitment, the majority are not imposed by the EU, so it’s very unlikely that regulations around pensions, benefits, tax or National Insurance will change at all.
As an employer, you will however continue to be responsible for checking that your staff are eligible to work in the UK, at the very least until the government sets out a new immigration strategy.
Of course it’s unlikely our borders will suddenly close to the EU, as in a number of sectors the free movement of workers has major economic benefits and is essential to ensuring British businesses continue to lead the way in fields like digital technology and science; two important areas to the North East.
Businesses need to be able to continue recruiting the best people to fill the jobs available, and the expectation of what may happen to EU employees seems to be that currently employed skilled staff will remain eligible to work in the UK following the introduction of an Australian style points system, but if you have a large number of unskilled EU workers in your business it may pay to begin planning ahead for the practicalities of replacing them, should you need to do so.
With considerable uncertainty set for some time to come, now is not the time for hasty reactions from employers or the government. While leaving the EU is inevitable, it may not come as quickly as people predict which should give businesses the opportunity they need to prepare for any change.