Eight in 10 UK manufacturers hit by worker shortage

07 January 2019 Consultancy.uk 2 min. read

As the UK Government looks to reduce immigration from the EU by as much as 80% after Brexit, around the same percentage of manufacturers are already reporting a shortage in labour. With an ageing population and high employment meaning competition for talent is high, UK manufacturers stand to be hit hard by the proposed post-Brexit immigration policy.

The UK has seen the number of manufacturing jobs fall by 17% since 2006, according to estimates based on data from the Office of National Statistics. Digital disruption resulting from innovative new Artificial Intelligence (AI) was largely blamed for this trend, and it was thought for some time that automation would see that figure rise further, as the industry hosting many repetitive roles that could be automated.

However, while AI is often spoken of as being a phenomenon that will be bad for jobs in the manufacturing sector, it is becoming increasingly apparent that the human touch will remain an essential asset to the industry. Instead, AI should be wielded to improve the performance of the human workforce, rather than replace it.

Eight in 10 UK manufacturers hit by worker shortage

As it becomes increasingly apparent that AI will not simply reduce the number of jobs required in manufacturing – as bosses keen to cut costs had hoped it might – but rather, reallocate some, a major problem now confronts the industry. Months before the culmination of Brexit, The British Chambers of Commerce (BCC) has found that over four-fifths of manufacturers struggled to hire the right staff in the final months of 2018.

In a survey of more than 6,000 employers across the country, the organisation found 81% of manufacturers and 70% of service sector firms reported difficulties with finding staff with the right qualifications and experience. This means British manufacturers currently face the largest shortage of skilled workers since 1989, with UK employment at a high, and fewer EU27 nationals arriving in the UK to work since the Brexit vote.

The news comes ahead of plans by Sajid Javid, the UK Home Secretary, to cut immigration from the EU by 80% after Britain cements its withdrawal, including through the extension of a £30,000-a-year minimum salary threshold already applied to non-EU workers. Coupled with an ageing population, this could quickly see the eight in 10 UK manufacturers facing staff shortages rise further in the coming years.

Commenting on the findings, Dr Adam Marshall, Director General of the BCC, said the government should listen more closely to business when it came to drawing up its migration policies. He explained, "Business concerns about the government's recent blueprint for future immigration rules must be taken seriously - and companies must be able to access skills at all levels without heavy costs or bureaucracy.”