The recruitment sector and BrexitMay 16, 2019Olivia Cheetham
The effect of Brexit so far on the recruitment sector…
Following the Brexit extension in April, we are no closer to seeing light at the end of the tunnel. Whether you agree with Brexit or not, there is no doubt that it has already had an effect on the recruitment sector and will continue to do so as and when an agreement is put in place.
Our clients talk to us about the ongoing challenge of talent acquisition. Those recruiters that focus on niche sectors or in areas such as food manufacturing, healthcare and warehousing have previously had success in sourcing many specialist workers from EU countries. A recent study by the CIPD and The Adecco Group showed that the number of EU nationals coming into the UK to work has dropped by 95% between 2017 and 2018. Recruiters are therefore struggling to keep pace with their clients workforce demands. Unfortunately, in the UK we struggle to feed this pipeline of lower paid labour from our own employment pool. The higher cost of living (which has not been reflected in wage increases) and the difficulty EU workers already face entering the UK due to immigration controls, means that the UK is no longer as an attractive place to work.
These challenges have led to innovative recruiters looking at diverse hiring strategies. Whilst many already put in place alternative techniques more are thinking outside the box when it comes to attracting new talent.
See our recent post on LinkedIn in highlighting Virgins strategy to recruit from Prison.
In 2018, the UK recruitment sector had a total revenue of £12.3bn. Whilst this had grown from 2017 the rate of growth had considerably declined compared to previous years. A recent report produced by BDO showed that 96% of HR professionals and recruiters believed Brexit has already affected their hiring strategies. Whilst all these statistics point to the industry being in decline, the figures for investment tell a different story. According to the BDO report, investment into the UK reached a 5 year high in 2018, demonstrating continued growth in demand for UK recruitment assets. The report highlights that despite uncertainty, investment is still attractive due to the skills shortage and the value of the pound. These have all contributed to businesses being undervalued and therefore attractive to investors.
Businesses often turn to their recruitment partners for employment advice and to ensure they are up to speed with the latest legislation. However, the biggest issue at the moment is the uncertainty around Brexit, therefore, recruiters are at a loss to have these meaningful conversations with their clients. There is still talk of another referendum to decide once and for all whether to stay or go. But will this happen? And no one could predict the result! So, it still remains a challenge to put plans for the right recruitment strategy in place.
If there is anything you would like to discuss regarding your own business strategy, please call our Client Care Manager, Shelagh Ward, on 01943 883263.
With Easypay, it’s personal…