Recruitment shortage exacerbated by a fall in the number of EU workers

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A new report into the labour market has revealed the recruitment shortage of skilled workers could be due to a fall in the number of EU workers

The latest Labour Market Outlook has warned early indications that a recruitment shortage is being felt in key sectors of the UK are due in part to a fall in supply of EU workers

The construction industry, which relies heavily on EU nationals to fill some skilled roles, has experienced significant recruitment shortages over the past 12 months. In particularly difficulties recruiting plasterers, carpenters, roofers and bricklayers remain an issue—one that could worsen after the UK leaves the EU.

Record numbers of vacancies

According to the outlook from the CIPD and The Adecco Group, record numbers of vacancies exist throughout the UK across a number of sectors, but employers are struggling to fill roles with the right candidates.

Figures from the Office for National Statistics suggest there are some 748,000 vacancies, but that a fall in the supply of EU nationals has left many roles unfilled. Data from the ONS in January revealed low-skilled sectors that typical employ large numbers of non-UK nationals from the EU are facing significant labour challenges in areas such as retail, wholesale, manufacturing and health.

The UK is less attractive to overseas workers

The outlook asked more than 1,000 employers for their feedback on the current labour shortages and found the most common response was to leave positions they could not find a suitable employee for empty.

This, the outlook suggested, reflects that the UK is attracting and retaining fewer EU nationals—something that could undoubtedly have far-reaching ramifications for sectors like construction.

Furthermore, the report revealed that as many as one in four employers had seen evidence EU nationals at their firms were considering leaving their organisation and/or the UK this year.

While these figures are not seasonally adjusted they are consistent with official data and suggest the number of non-UK nationals from the EU halved from an average of more than 60,000 per quarter in the nine months to June 2016 to just 30,000 in the three months to September 2016.

Slowdown in the number of EU workers

Gerwyn Davies, Labour Market Adviser for the CIPD said: “The most recent official data suggest that there has been a significant slowdown in the number of non-UK nationals from the European Union in work in the UK.

“This is creating significant recruitment challenges in sectors that have historically relied on non-UK labour to fill roles and who are particularly vulnerable to the prospect of future changes to EU immigration policy.

“With skills and labour shortages set to continue, there’s a risk that many vacancies will be left unfulfilled which could act as a brake on output growth in the UK in the years ahead.

“Employers need to start collecting data about their workforce and review their approach to workforce development and training to avoid a squeeze on skills and the workforce.

“Employers in sectors like retail, hospitality and care, will need to work much harder to attract candidates and combat labour shortages by improving the attractiveness of their jobs through better line management and job design, developing closer links with local educational institutions and improving pay and employment conditions where possible.”

Migration

Respondents of the survey were asked how they would deal with any migration restrictions imposed post-Brexit. A total of 26 per cent said they would ‘pay the difference’ to recruit EU nationals, while 19 per cent said they would retrain older workers. Some 17 per cent said they would recruit more apprentices, but only 16 per cent said they would look for UK-born graduates.

CEO of The Adecco Group UK & Ireland John L. Marshall said: “The big decisions that Britain took last year are beginning to show in the UK labour market.

“It is encouraging that some employers are beginning to look to new solutions for their future workforce with investment in retraining and apprenticeships, but many more need to begin this planning and investment in their workforce.

“Whilst the outcome of Brexit negotiations is still uncertain, employers’ access to EU migrant workers is likely to change.

“Investing in young people is a solid long-term strategy, but employers also need to face the facts and prepare for a situation where they might lose access to significant numbers of skilled EU workers in the near future.”

While the survey did not solely relate to the construction industry, rather a number of key sectors across the UK economy that use EU workers, it paints a bleak picture. Construction relies on EU workers to fill skilled positions and if the UK is less attractive to workers the skills shortage could worsen significantly in the next few years. This in turn could put infrastructure projects at risk.

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