Britain’s Businesses Complain of Labor Shortage Due to Brexit and Pandemic
Since Britain voted five years ago to break with the European Union, there has been an exodus from the country of EU workers, which has gathered pace since the pandemic struck, according to British government figures.
Many among the more than one million EU citizens who have left went to Germany and the Netherlands, leaving Britain’s coronavirus-hit businesses desperately short now of labor and complaining they are unable to fill staff vacancies just as Britain is planning to lift, on July 19, its remaining pandemic restrictions and hoping for a V-shaped economic recovery.
The country’s hospitality industry, which is heavily dependent on foreign-born labor, has been among the hardest hit by staff shortages. Last month, several restaurants in North West England’s Lake District, an idyllic tourist spot whose businesses hope to benefit from an influx of British so-called “staycation” tourists unable to fly for overseas vacations, announced they were closing because of staff shortages, including Little Italy in the town of Kendal.
“It was a very successful restaurant, but I just can’t staff it,” Richard Berry, the owner, told the local newspaper, the Westmorland Gazette. “We got to the bare bones with really good-quality staff and getting new staff when people leave is almost impossible,” he added. British Firms Mull Relocating To ‘Other Side of Brexit Curtain’Some British firms consider fully or partially relocating to mainland Europe, saying they fear for their prospects, if they don’tThe owners of a gingerbread store in the nearby village of Grasmere echo the complaint, telling local media they have spent more than $7,000 advertising four staff vacancies to no avail. “This is the worst staffing challenge we’ve ever had,” co-director Joanne Hunter said.Britain’s pubs are also scrambling to recruit staff, prompting the owner of JD Wetherspoons, a chain that owns nearly a thousand pubs, to urge the government to allow more migrants from the EU to work in Britain. Tim Martin, the founder and chairman of the chain, was an ardent advocate of Brexit.
The freight, construction and health sectors are also struggling to fill vacancies, adding to the rising alarm of owners and their shareholders already trying to limit the economic damage of 15 months of pandemic lockdowns and restrictions.
They have been urging the ruling Conservatives to make it easier to hire workers from EU countries. Under new post-Brexit immigration rules, EU citizens not already settled in Britain have no automatic right to work in the country and the new immigration system gives priority to high-skilled workers.
Britain’s shipping and freight industry has warned that Britain is facing a mounting delivery crisis because of a shortage of drivers. Industry officials say supermarkets risk seeing supply chains erode because of the labor shortfall. Last month trucking company bosses urged Prime Minister Boris Johnson to allow them greater access to the EU labor market by introducing temporary worker visas for Heavy Goods Vehicle drivers. They say the shortfall is partly the result of pandemic delays in testing new drivers and partly the result of at least 15,000 drivers from EU countries not returning to Britain after leaving last year during the lockdown. Brexit Bites for British Businesses as Border Delays Slow TradeGovernment says ‘teething problems’ will be sorted out, but analysts warn of structural issues in Brexit deal So far their request has been rebuffed. Britain’s interior ministry said in a statement in response to the plea that employers should “focus on investing in our domestic workforce, rather than relying on labor from abroad.” Commercial transport bosses say that won’t help them fill vacancies in the short term.
After meeting with government officials last week, the chief executive of the Road Haulage Association, Richard Burnett, said in a press statement: “The need for action is clear and urgent. We and many others have provided overwhelming evidence that the shortage is getting worse — the situation must be addressed right now.”
The RHA estimates that the country is short of 60,000 drivers— other industry groups put the figure closer to 100,000, around a third of HGV drivers working pre-pandemic. The training and examining of new recruits can take several months. The boss of Britain’s biggest supermarket chain, Tesco, says his company is facing a shortage of drivers. Ken Murphy told a conference call with analysts that Tesco was “working hard” to address the problem
Approximately 5.6 million EU citizens living in Britain before the country’s formal departure from the bloc last year have applied to settle in the country under terms London and Brussels agreed in a Brexit deal, according to new data released this month by the British government. That is two million more than authorities had estimated were in the country.
According to Jonathan Portes, an economics professor at King’s College London and a former British treasury official, the data shows “the importance of EU nationals to the UK economy and labor market.” But in a recently published paper he says, “It is still the case that EU migration has fallen very sharply since the referendum.”
He puts the exodus down to several factors, including legal and psychological ones “relating to the uncertainty about the future rights that EU citizens currently resident might enjoy, and the more general political and social climate, with the UK no longer seen as a hospitable destination for EU migrants.”
But the pandemic and lockdowns have also, he says, been key drivers in the outflow of at least 1.3 million EU citizens. “For many migrants, especially those from eastern, central, and south-eastern Europe and especially those who have arrived recently or have family back home, the choice would have been to stay here, with no job, less or no money, and pay for relatively expensive rented accommodation — or return home to family, with lower costs and most likely less risk of catching COVID,” he wrote.
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