Brexit and Recruitment, a lethal mix?
The Brexit effect is expected to influence the business scene in the UK. So many changes will occur in different commercial and industrial sectors including the recruitment processes in companies. On March 29, 2017, it was confirmed that the UK will proceed with its move to leave the European Union. This decision has been received by business owners and residents in many ways. Entrepreneurs are afraid of the unknown, businesses are uncertain, and the UK residents are not sure of the next move. The only thing we can do at the moment is to prepare and wait.
In this article, we will be discussing the different ways Brexit will influence recruitment and how businesses in the UK will be affected post-Brexit.
Negotiations are still on-going, but the uncertainty has limited the ability of employers to make long-term decisions. For example, the year is almost over; this is a time when businesses will be making moves to increase sales and meet the high demands associated with the end of year sales. It is also a great time for re-strategising to improve products and introduce new features to meet the needs of customers. Businesses should also be making efforts to create and implement plans for expansion at this time. However, it is apparent that one wrong move can be very costly and this is not the time to lose money. The situation is unpredictable, and the employers are more comfortable waiting it out before making decisions to employ more staff.
On the other hand, the competition has not been eliminated. Regardless of the current situation, the business has to survive. This means the current customers must be retained and new customers won over to sustain the business. This means businesses still need competent staff to maintain the high standards of their operations if they want to remain competitive in the market. Losing business edge by slowing down operations due to the uncertainties of the Brexit movement is not going to be favourable for any business.
A low number of applications from outside the UK
Since the start of 2018, the reports from HR sectors in the UK indicate that the number of applications from candidates outside the UK has remarkably reduced. It is not surprising to witness this trend. The statistics show that 36% of candidates who have required skills are not willing to apply for good jobs in the UK because they do not want to live there. These are people who enjoy many rights and benefits as EU citizens, moving to the UK will subject them to new laws and immigration conditions that can hinder professional growth and self-development. Previously, HR teams in top companies located in the UK receive applications from trained candidates in countries such as Germany, the Netherlands, and France, to mention a few, but the situation has changed due to Brexit. It can be confirmed that hiring a diverse set of professionals has been very good for businesses. The combination of talents and skills from all over the European Union and the UK has helped many businesses grow and expand globally. However, this good fortune for businesses may be hindered by the Brexit move.
What are the options for businesses?
As mentioned earlier, before the Brexit plans are concluded the business must be sustained. While the employers are reluctant to carry out extensive recruitment exercises at the moment, they have considered another option. The reports indicate that more businesses in the UK are now open to employing short-term staffs that are offered casual contracts to work for the company.
We cannot criticise this move by businesses because it is cheaper to recruit temporary staff on contract. These contracts do not compel the companies to pay very high rates as salaries and benefits, and they can maintain their level of productivity and output. Also, so many people have accepted these temporary contracts because Brexit also means the average resident in the UK has to save a lot of money in case the unexpected happens.
The effect on recruitment
In the recruitment sector, the switch from searching for permanent staff to hiring short-term temporary staff has also had its effect. The interview methods have changed, and the HR teams are not as confident to create attractive job adverts because they know the temporary jobs are not very lucrative. While the recruitment process undergoes these changes, the HR teams have to modify their requirements to target employees who are willing to work temporarily. However, there has been a notable reduction in the quality of candidates for the job positions being advertised.
Candidates with high standards and talents are not willing to ‘waste their time’ working as temporary staff. These groups of candidates know their value and how much they can contribute to the growth and profits achieved by the company. So they avoid low paying temporary jobs which business seem comfortable to offer at the moment. Consequently, the HR team is seemingly caught in the middle. HR teams are stuck with finding ways to fill vacant positions with talented candidates who do not mind receiving lower pay and working without job security. From a realistic viewpoint, the candidates who will be willing to accept these offers are few.
From another perspective, the HR teams can consider recruiting candidates with average qualifications and train them to improve skills and proficiencies. However, there is another hindrance to this plan. The businesses are not willing to spend so much money on training and self-development at the moment. This attitude expressed by businesses is due to the uncertainties of the events after Brexit.
Why are businesses so afraid of the post Brexit period?
To be sincere, who wouldn’t be afraid? Consider the current situation that is playing out with the negotiations. The UK Prime Minister Theresa May and her support team have been having a difficult time negotiating the Brexit. The European Union has insisted that there will be no deal with the UK until certain terms are met. The UK negotiation team led by Dominic Raab have been spending sleepless nights to find a way for the Brexit to happen with the least impact on the UK. It has not been an easy task.
The business owners all over the UK have been watching and waiting anxiously to know their fate. Some notable companies such as HSBC, Lloyd’s, Barclays, and JP Morgan have started making moves to move the bulk of their operations out of the UK. It is an unnerving experience for business owners at the moment.
Many businesses thriving in the UK rely on skilled employees from the EU to maintain their production standards. Unfortunately, there are over 3.6 million EU citizens who live and work in the UK. If the Brexit happens, it is very likely that a majority of these people will move out of the UK. Consequently, businesses will experience a massive shortage of skilled manpower and management teams to run their businesses. The reason for this speculation is that to remain and work in the UK there will be stringent conditions. The EU citizens who choose to stay back will be compelled to go through an immigration procedure to obtain settlement papers. These documents will enable them to live and work in the UK. However, the reports show that not many EU citizens are happy about this idea and they may leave.
On the other hand, recruiting skilled employees from the EU will be a good idea. The process is, however, going to be more expensive for the business owners in the UK. They may need to spend more money to secure settlement documentation and accommodation for the employees coming into the UK. These expenses will be as a result of the changes in the immigration laws that make it compulsory for EU citizens to be documented before they can live and work in the UK. It is also expected to be a strenuous process which will be long and hectic for the HR teams in charge of recruitment processes.
Another reason the business owners in the UK are so afraid of the post Brexit period is the huge number of EU citizens in the UK. They have contributed to the growth of the economy and businesses in many ways. These groups of people rent apartments in the UK, pay taxes, buy cars, and promote retail businesses through regular patronage. Losing half the number of EU citizens currently living and working in the UK will mean a loss of revenue for the UK businesses.
In addition, the thriving businesses in the UK depend on doing business with the EU companies in many ways. For example, a majority of their utility and private cars, factory equipment and other business tools are imported from the EU. The UK businesses also rely on the EU for spare parts used this equipment or vehicles. The Brexit means business owners who rely on these parts will need to spend much more money to stay in business. Many entrepreneurs will need to pay higher fees to import the equipment they need to keep their businesses moving forward. The alternative is to buy from local companies and suppliers in the UK which will also be quite expensive if the raw materials to make the products have to be imported from other countries.
Businesses will also be compelled to increase their marketing budgets. The competition in industries will rise, and there will be pressure to increase sales. Ultimately, marketing strategies will need to be reviewed. Many businesses will choose to adopt new marketing strategies. This means a higher budget for marketing, and hiring the experts in those fields to ensure the business gets value after a huge investment.
The high reliance on products sourced from the EU is observed in industries such as the automotive sector, aviation, financial services, and the different aspects of the hospitality sector. Overall, businesses in the UK are bracing for a post Brexit period where they will be compelled to spend twice their regular budget to remain in business and stay relevant in the market.
Recruitment strategies to survive the post Brexit
This is a great time for businesses to start making plans for the future. While there is still a high level of uncertainty regarding the post Brexit era, there are certain ways businesses can ensure that they retain the best candidates to stay competitive in the market.
Long-term hiring plans
Even with the uncertainties, it is possible for businesses to retain their best employees in the post Brexit period. This can be done by reviewing the recruitment plans and goals to include features that support long-term recruitment. It is simply about hiring talented candidates and offering them packages that will encourage them to stay with the company regardless of how the Brexit affair turns out. Securing the loyalty of talented candidates will increase the chances of businesses to remain competitive in the market.
This will require a huge investment in employee welfare, a decision many companies will not be happy to make, but it will be worth it in the end.
Retaining old employees
All efforts can be made by the business to encourage old employees to stay with the company. These are employees who have probably been trained and have the needed experience to keep the business running smoothly. The HR team will need to collaborate with business executives to identify particular strategies that can be used to retain older employees. In a job environment that is comfortable and offers remarkable growth opportunities, businesses can convince their employees, especially EU citizens, to remain with the company.
Employee training
In preparation for the impending shortage of skilled workers in the industries, businesses can make efforts to reduce the impact on their operations through training. Employee training programs targeted at making the employees highly proficient in performing their jobs will help to sustain high levels of productivity, and the business survives.
Giving students job shadowing opportunities
Sourcing for talented employees from within the UK can be done by offering students job shadowing opportunities. This process involves offering students positions as interns where they observe and learn from professionals in the field. Job shadowing is a direct way of learning on the job. It is also beneficial to businesses in many ways. Through job shadowing, the business owners can identify students who have a natural talent for the job. These talents can be quickly offered jobs and trained. When they graduate from their schools, they will be easily absorbed into the business to start working and contributing to business growth.
Prioritising business goals
Businesses can continue thriving by prioritising their goals to reduce any impact the Brexit move may cause. This can be achieved by working with the HR team to identify aspects of the business that must not be compromised to achieve the company’s goals. In this regard, HR teams focus on helping the employees who manage crucial aspects of the business to perform at a higher capacity. A good approach the HR team can proceed by leveraging information sourced from the employees to create better operational strategies in the workplace. Projections can be made in the long-term and the employees trained to handle the changes that may occur at that time.
In conclusion, the Brexit move has changed the game for many businesses. Companies that relied on skilled employees from the EU now have to find alternatives within the UK or pay more to access these talents from the EU. The best option for businesses is to explore and exhaust all the alternatives they can use to sustain their businesses from within the UK. This is a cheaper option, and only if these plans don’t work should they consider more expensive alternatives such as spending more money to hire talents and buy resources from other countries.
