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Construction response to fewer EU nationals looking for UK work

Many words have already been written about the potential impacts of the looming Brexit.

The impact of this divorce is already being felt even before processes are turned into law. In their latest survey, research from the Chartered Institute of Personnel and Development (CIPD), suggests fewer EU nationals are looking for work in the UK

Given the well documented skills shortage in the construction industry, the latest evidence is deeply troubling. We look at how construction can respond to this.

Labour Market Outlook Survey

Overall, 29% of employers said the EU nationals employed by them were thinking of leaving employment as a result of the referendum result.

Produced quarterly, CIPD's Labour Market Outlook (LMO) survey highlights employers' recruitment intentions and also covers, amongst other things, the effect on employers since the UK's decision to leave the European Union. 

Although non-UK nationals in the EU working in the UK increased by 221,000 in the 12 months to September 2016, almost three in 10 employers said that non-UK nationals from the EU considered leaving their job in the six months to December 2016. 
In addition, the quarterly increase in EU nationals working in the UK slowed down, which gives the implication that employers have seen an increase in difficulty when finding suitable candidates.

It's a problem that could get worse in the next few years, especially considering the already existing skills and labour shortages. 

The proportion of employers who said their employees from the EU are considering leaving the UK this year has decreased slightly, but it's still at a worrying 27%. 

It's important that employers face up early to the fact that they're likely to lose access to significant numbers of EU workers on current labour movement terms in the near future.

A greater investment in skills has been suggested to offset the reduction in supply of EU nationals but data from the survey shows that there has been a fall in investment. 

Employers canvassed in the survey feel that recruitment efforts need to target younger and older workers if there is any chance of reversing the labour shortage. 

It seems as though business owners across the UK understand how vital EU workers are, as John L Marshall, CEO of the Adecco Group UK & Ireland, explains in his foreword to the survey: 

"In their responses, over a quarter said they would be willing to 'pay the difference' and absorb the extra cost of recruiting EU nationals."

It is understandable given the demand for labour being high and a near record number of new vacancies. 

However, John L Marshall warned employers that they will have to prepare for change.

More than half of the 1.15 million non-UK workers from the EU are employed in either Manufacturing, Construction, Wholesale and Retail, Accommodation and food services or Health and Social work. 

He said: "It's important that employers face up early to the fact that they're likely to lose access to significant numbers of EU workers on current labour movement terms in the near future, and begin to take steps to mitigate this."

At the end of February, Home Secretary Amber Rudd wrote to peers in an attempt to avoid defeat in a House of Lords vote on the Brexit bill regarding the rights of EU citizens. 

In this, she promised: "Nothing will change for any EU citizen, whether already a resident in the UK or moving from the EU, without Parliament's say so."

Despite this reassurance, a cross-party amendment asking for a firm guarantee of EU workers' rights secured backing. 

Construction perspective

CIPD's LMO survey represents a number of different industries, with 15% of respondents coming from manufacturing and production. 

Construction itself accounts for 4% of respondents, which may seem small but only four other industries are more densely represented in the study. 

"Labour-heavy fields such as construction have historically relied on foreign talent to plug ever-expanding skills gaps in the UK" 

However, there can be no doubt of the importance of non-UK nationals from the EU for the construction industry. 

More than half of the 1.15 million non-UK workers from the EU are employed in either Manufacturing, Construction, Wholesale and Retail, Accommodation and food services or Health and Social work. 

For construction, the figure is 181,000. 

It stands to reason that the construction sector, on top of skills shortages that already exist, will feel the effects of restricted EU labour movement. 

Paul Payne is the Managing Director of One Way - a construction and rail recruitment specialist. 

He views the CIPD data as 'unsurprising' and explained that the appeal of UK jobs will decrease, which could be disastrous for industries such as recruitment. 

There quite simply aren't enough people interested in this career option at the moment and it is this issue that needs to be addressed both in this country and across Europe.

He said: "Labour-heavy fields such as construction have historically relied on foreign talent to plug ever-expanding skills gaps in the UK. 

"With the vote to leave the EU causing no end of uncertainty for EU workers, employment opportunities in this country will naturally appeal less to European professionals - particularly given the Prime Minister's vocal intention to leave the single market."

Greater collaboration needed

Leaving the single market - which will consequently restrict access to EU labour - will only exacerbate the skills gap. However, this is to mask an already existing problem, as Paul Payne explained: 

"There quite simply aren't enough people interested in this career option at the moment and it is this issue that needs to be addressed both in this country and across Europe."

For their part, One Way are trying to change the pattern, which includes a campaign to encourage more school leavers into the construction industry.

The simple fact is we all have a vested interest in improving the numbers of individuals seeking a career in construction.

However, as of yet, the progress to improve construction as a career choice is slow. 

What needs to happen? Greater collaboration, according to Paul Payne. 

He believes that all organisations working together with the government and education providers is a must if 'vital' projects are to stave off delays or cancellation. 

He said: "What we need to see is greater collaboration between employers, recruiters, education institutions and government organisations to tackle the issue. 

"Regardless of any conflicts of interest these stakeholders may be concerned about, the simple fact is we all have a vested interest in improving the numbers of individuals seeking a career in construction. 

"Otherwise, there will only be a delay - or even cancellation - of projects that are vital for the UK's economy."

Written by John Train

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