News Archive - November 2018

Migrant Labour Trends Fall into Reverse, leading to Employer "Supply Shock"

07 Nov 2018 | Posted by Carl Thomas

Skill shortages in the UK continue to rise as companies struggle to take on more staff. According to the latest Labour Market Outlook created by the Adecco Group and the CIPD, while the outlook for employment in the short-term remains consistent, skills and labour shortages are accelerating.

The net employment balance for the survey into more than 1,000 employers - a measure showing the difference between the number of employers expecting to increase staff levels and those planning to decrease staff levels is currently positive, at +22 compared to a rate of +23 in the last quarter. However, seven in ten employers with current vacancies say that their empty roles are challenging to fill thanks to new issues with UK work permits. This is a much higher rate than in Spring (61%) and Summer (66%) of 2018.

Though skill shortages have been rampant across many industries of late, the problem is being enhanced by a drop in the number of non-EU and EU migrants available to employ in the UK. The latest data suggests that the number of non-UK-born employees in the country has decreased by 58,000 over the last year. However, despite what the media may say, the work permit UK problem is coming mainly from a lack of non-EU-born workers, whose numbers decreased by 40,000 in the last year.

In the years to come, experts predict that migration-sourced labour and UK visas will continue to struggle, particularly after 2021 when migration restrictions appear from Brexit. Many of today's employers are concerned that they will no longer be able to satisfy their recruitment needs after the new migration restrictions come into place - particularly for lower-skilled staff members.

Additionally, a third of employers who currently hire non-EU citizens within their workforce believe that the administrative burden that comes with the points-based system for non-EU workers will be too significant. Around 26% of people in the latest study said that the salary threshold presented by the new UK work permit restrictions is too high, while 20% of employers believe that the cost implications of the current systems are too high as well.