UK immigration: Business groups call for urgent action to avert skills crisis as net migration plummets

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British business groups have called for urgent action to address the UK’s worsening skills shortage after the latest figures revealed plummeting net migration.

The Office for National Statistics (ONS) said net migration in the year to September was down by 47,000 to 244,000 people – a similar level to early 2014 and down on record levels in 2015 and 2016.

The number of European citizens arriving has dropped sharply since the EU referendum, while the number of people from outside the bloc has increased.

“These figures confirm what businesses up and down the country are telling us. It is becoming much more difficult to recruit the people that businesses need with employment rates at record highs,” said Neil Carberry, CBI managing director.

“Fewer EU workers coming to the UK is a significant factor in these shortages. To compete the UK needs to be somewhere that people want to come to work, and regrettably, increasingly it isn’t.”

Chartered Institute for Personnel Development - encourage investment in skills

“The CIPD/The Adecco Group Labour Market Outlook released earlier this week showed that future migration restrictions were unlikely to act as a catalyst for improving skills investment in the UK,” said Ian Brinkley, acting chief economist at the CIPD.

“The Government needs to encourage greater investment in skills and training, for example by making the apprenticeship levy into a much more flexible training levy that will help organisations develop the skills they need,”

“The UK government needs to shout, loudly, and in the direction of the EU that their citizens are needed, welcome and will enjoy long-term security by coming to the UK to work, study and settle,” said Tim Thomas, director of employment and skills policy.

“Without this, more will see the UK as a destination of risk not choice.

“Immigration from non-EU nationals has outstripped workers coming to the UK from the EU, and for EU workers from older member states - France and Germany - is taking a nose-dive.

“Study is now the second most common reason for immigration, which is a cause for celebration for the UK’s outstanding Higher education sector, but does not provide the workers needed to drive the economy of UK plc now.”

“The government’s failure to set out a long term plan is beginning to cost UK businesses, with 58,000 fewer people coming here to work – people who make a huge contribution to filling skills gaps currently holding back growth, said Mark Hilton, immigration and employment policy director of business group, London First, said:

“Business has spelt out the contribution that people from the EU make, the jobs they help create and - in the absence of ideas from government - has proposed immigration approaches that could give the UK a fair and managed system.

“The continued divisions and deafening silence from the government are hugely frustrating and increasingly damaging.”

“The Tier 2 visa limit has now been maxed out for the third consecutive month, with NHS workers, teachers and care workers lumped in with private sector employees.

As British Future have argued today, ministers must look at a more sophisticated approach that takes account of the skills both public services and the economy need. The Home Office must also do more to streamline its visa application processes, while the apprenticeship system needs to be made more flexible to give businesses access to the people they require today.

“These figures are no cause for celebration,” said Adam Marshall, director general of the BCC.

“At a time when businesses in every part of the country are seeing record skills shortages, falls in the levels of migration from the EU, for whatever reason, will only exacerbate the problem.

“Our recent survey work showed that only 2 per cent of firms look to hire directly from the EU in the first instance, preferring to hire locally.

“When skilled staff simply can’t be found, a fall in migration makes it harder for firms to maintain their existing performance – much less grow their business. The fact that skilled people are choosing not to come to the UK to work is a cause for real concern.”