Will a Points Based System Help Curb Labour Shortage in UK?

Many UK firms have faced a new problem recently. The problem is that of labour shortage. The number of migrants working in UK firms has reduced and this has...

Many UK firms have faced a new problem recently. The problem is that of labour shortage. The number of migrants working in UK firms has reduced and this has caused a problem for them. HR body the CIPD has reported that with the approach of Brexit, there is a reduction in interest towards the UK as a destination for the migrant workforce. This is true for both EU and non-EU migrants who work in the UK. 

Over a thousand employers in UK have suggested that these vacancies are increasingly becoming difficult to fulfil. As a result, this is causing employers to pay more salary to the employees working in their firms.  

The short-term outlook for employment is strong, but the shortage of labour and skills is continuously on the rise in UK. The latest official data suggests that the non-UK born workers in UK has reduced by 58,000 for the time period from April to June last year. In the same time period in 2018, the figure is 40000 for the non-EU born workforce. This can be contrasted with an increase of 263,000 for a similar time period between 2016 and 2017.  

As one can understand, the concept that UK is an attractive place to live and work for non-UK born people (including non-EU citizens) is slowly fading and constantly away from the minds of the immigrants. Gerwyn Davies of the CIPD mentioned that this has happened during the period of good employment growth and low unemployment prospects. As a result of this trend, recruitment difficulties have been heightened more for the employers looking for immigrants to be recruited in their firms.  

If more support is not provided and the system is not made simple, fair and affordable for low skilled works, then there is a risk that non-UK born individuals will be discouraged from using the post-Brexit system. Failure to do so in the light of a tight labour situation will further lead to negative situations for the existing work force in the UK firms. High workloads, loss of business for the firms are some of the negative situations that can arise if ample support is not provided.  

The CIPD while looking at the future prospects of work culture in the UK further highlighted that UK labour supply will be constrained from the year 2021 with the introduction of new migration restrictions for the EU citizens. This will especially be the case with low skilled workers in UK. Employers have become concerned that recruiting EU citizens for low skilled works as proposed by the Migration advisory Committee will not be enough to meet the recruitment needs. There is a chance that points based system for non-EU immigrants will be similarly adopted for EU citizens from 2021 as well. 

The report also found out that a third of employers who hire non-EU citizen mention that the burden of using the points-based system are very high. 

Priyanka Dutta 

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