Accessing EU talent after Brexit
The Immigration Act 2016 imposes a charge on immigration skills due to be introduced in April 2017, but could now be brought forward following the result of Brexit.
Without exemptions for EU nationals free movement, UK companies will need to use the points based Tier 2 system of sponsorship to recruit from the EU. Any one in HR ops who has supported tier two visas knows that there is a cost and risk associated with it. Analysis from law firm Simpson Millar shows that the total cost for recruiting workers from overseas might actually hit £3,000 or more.
Mariano Mamertino, an economist at one of the UK’s largest job boards Indeed, sums up “June’s official unemployment figures showed the jobless total reducing slightly, but the UK economy’s rate of job creation is fragile at best. In the longer term, crucial decisions will need to be made about what sort of labour market we want in Britain. UK employers have benefitted from the ability to recruit talent from overseas, and many Britons have seized the opportunity to live and work in other EU countries.”
It’s unlikely the door will close on the English Channel, the free movement of workers has obvious economic benefits. British businesses will need to be able to access the talent required to fill vacancies and Europe has been a big part of that source of talent.
European Outflow – gauging intention
In June this year there were 2400 searches on google for ‘permanent uk residency’ – up 5 x on May and almost 10 x on April. The upsurge in leaving the UK over recent months is not dissimilar. Despite Increasing interest in people looking to gain UK permanent residency status and preparing for a move out of Britain, I’m surprised that these search figures aren’t higher considering the ONS reports that there are 3.3M EU citizens in the UK.
Brexit to Frexit – will EU nationals move?
Talking to a senior professional Auditor based in the city, she points out that “the City’s infrastructure to support banking staff compared to other locations is immense. The city has got a lot going for it, over and above Ireland or Paris. I certainly don’t want to move, I moved to London because that’s where I want my job and my social life.”
Whilst Britain has been consumed by Brexit if we turn our eyes to the rest of Europe, the political and economic landscape for some is also uncertain – Italy are in the midst of a banking crisis and a call to exit the Euro (not Europe), a French election coming up in 2017 where the potential of Frexit is already being discussed.
From an investors perspective it is certain that political risk will be a bigger factor in investment decisions than it has been in previous years and Britain isn’t the only European city presenting political risk. Considering that US multinational corporations make up a large part of London’s capital market investors and if today’s Cable rates are maintained, it could be that London keeps its status as the European capital of secondary market trading.
London has a large sustainable supporting infrastructure with an immense amount of talent possessing a forward thinking outlook. After all, London’s providence as the European financial services capital enabled it to become the centre of Chinese renminbi trading despite Brexit woes.
You can bet that city lobbyists will be working overtime to maintain London’s status as a Global and European financial services hub and to maintain its plethora of European bankers.