The end of freedom of movement due to Brexit will damage UK businesses and public service delivery unless post-Brexit immigration policies take account of the need for both skilled and unskilled labour from the EU. According to research from the Chartered Institute of Personnel and Development along with the National Institute of Economic and Social Research (NIESR).

The research calls on businesses in the UK to broaden their recruitment and people development strategies to ensure they are doing all they can to attract and develop UK-born workers and highlights the need for significant changes to Government skills policy.

The research, ‘Facing the future: tackling labour and skills shortages post-Brexit’, analyses employers’ perspectives on migration restrictions following the end of free movement and is based on a survey of more than 1,000 organisations, employer focus groups held around the UK and interviews with HR leaders.

“Access to skilled and unskilled labour is a huge concern for employers,” Peter Cheese, Chief Executive of the CIPD, said. “If the Government does not provide a straightforward, flexible and affordable immigration system for EU nationals post-Brexit, as set out in our recommendations, significant numbers of employers are likely to face real skill shortages which may hold back their growth and performance.”

“With the Brexit negotiations starting this week, there is still little clarity on the immigration system that the UK will adopt after Brexit,” Cheese said. “An overly blinkered approach focused on simply cutting immigration to tens of thousands and focusing only on high-skilled employees could leave employers high and dry, especially those who rely more on EU migrants to fill low-skilled jobs. The Government must, therefore, consult far more widely about their plans and invite employers to play a key role in shaping the future of UK immigration policy to ensure it works for businesses and the economy.

The research also suggests that while Brexit will encourage some employers to work harder to recruit local candidates and people from under-represented groups in the UK, employers are already working with schools to provide apprenticeships and invest in training. However, they are unable to find the skills and people they need.

The report states that employers have difficulty attracting sufficient UK nationals to work in low paid and low-skilled jobs despite offering higher pay and investing in the skills of the workforce in some cases. However, employers in low-paid sectors such as retail and hospitality are more likely to report they employ EU migrants because they have lower expectations around pay and employment conditions (15%) than the all employer average in the survey (7%).

“The report concludes there is a strong need for employers to be able to continue to recruit unskilled labour from the EU where they are unable to recruit locally and have shown they have made all reasonable efforts to recruit from within the UK,” Gerwyn Davies, labour market adviser at the CIPD, said. “Any efforts to hinder this will hinder business growth.”

“Our research adds further weight to evidence that employers don’t recruit EU migrants in preference to British workers, but because they attract too few British applicants,” Heather Rolfe, Associate Research Director at NIESR said. “Ideally, many employers would like to recruit more young people but working in a meat factory or a care home is not top of the list for school leavers now, and never has been.”

”It would be very unwise indeed for the Government to end free movement without putting in place new policies which enable employers to meet their needs for lower skilled labour,” Rolfe said. “Our key sectors and services will suffer damage if policies to replace free movement are introduced in haste and are costly, complex and bureaucratic.”