The think-tank Resolution Foundation commissioned a survey to clarify the preparedness of British business for the radical changes that Brexit will bring. ComRes research consultancy interviewed 500 employers who currently employ nationals from across the EU and found that practically half the businesses have a complete disconnect between their own expectations and the likely reality of the effects that Brexit will bring.
The finding highlighted the fact that at least 17% of the employers are under the impression that there will be no change in the capacity for EU nationals’ inbound freedom of movement. Also, nearly of third of the businesses in the survey believed that as long as an EU national had a job offer the system would be maintained as it is at present. A surprising 46% of businesses surveyed stated that they did not anticipate a change in the number of EU nationals they employ in the next 12 months, with nearly a quarter expecting to increase the number of immigrant workers despite the fact that there has been a drop of over 100,000 in the net migration since the Brexit referendum. When the Financial Times contacted every FTSE 100 company earlier in the year only four were engaged in detailed planning for the consequences of Brexit.
The extraordinary lack of recognition of how Brexit will impact on their businesses and the complete failure to plan for the inevitable changes is extremely worrying. The chasm between what businesses expect and want to happen and what the government is offering is even worse, with almost two-thirds of firms saying no change to the existing movement of EU nationals or a change to permitting movement with a job offer would be best for them; whereas the government is indicating that migration will be controlled by the government and not driven by businesses.
Without the cheap labour that the UK market has been able to enjoy in recent years together with having to look for new markets will seriously impede the growth in many companies unless they look closely at their business model and how it will fit into the changing markets. The failure to recognise that lower migration and an ever rising minimum wage will have a significant impact on business costs could prove to be a costly mistake for many businesses.
A-head-in-the-sand mentality is the most disastrous strategy to embark on, in order to be able to take advantage of any opportunities that open up post-Brexit, businesses must be in the best possible shape to maximise their chances; there will be limited opportunity for back-tracking and changing strategy. Businesses must take steps to ensure that their existing key workers are protected and plan for future recruitment so that they are ready for the new European order. To assist trade the government should provide clarity to the commercial world to enable businesses to make as smooth a transition as possible into the post-Brexit market or productivity will be damaged. Things will change, the journey has begun and there is no turning back.
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