Employment law issues seem to be rife with gaps at the moment. We have already reported on the gender pay gap, brought to the fore by the UK’s new reporting regulations for gender pay that took effect on April 6, 2017. However, it looks like we are now dealing with another gap: the skills gap that commentators believe will be one of the consequences of the UK exiting the EU. In fact, we are already seeing the effects, as potential migrant workers are reluctant to come to the UK at a time of such uncertainty. As a result, there is a significant shortage of workers to fill such typical blue collar jobs as drivers, electrician assistants and construction workers. Sectors such as healthcare, retail and construction are among those feeling the squeeze, as they are heavily reliant on EU migrant workers. A study by the Recruitment and Employment Confederation (REC) points out that EU migrants are over-represented in low-skilled jobs, filling 15 percent of them, compared with 7 percent by non-EU migrants and 78 per cent by Britons.
Furthermore, Brexit has led to curbed planned growth and investments for one in four small and medium-sized enterprises (SMEs), according to the latest “UK SME Confidence Index” from Vistage. And the shortage of workers has forced employers to raise starting salaries. According to the REC study, in August salaries increased at the fastest pace in nearly two years. This trend may not be sustainable over the long haul if it impacts too negatively on profitability and business sustainability.
In the meantime, automation and digitalization have been proposed as possible solutions to bridge the gap. However, whether replacement of people with machines is quite what voters intended back in June 2016 when the referendum took place is questionable at best.
