Recruiters say Brexit vote paves the way for an uncertain future
The votes have been counted and, with a 52% majority, Leave was declared the winner of yesterday’s referendum vote on whether the UK should leave the European Union.
71.8% of eligible voters made their way to polling stations or completed a postal vote, and this accounted for more than 30 million people.
Following the results of the vote Prime Minster David Cameron announced he will be stepping down by October this year, leaving the door of No.10 open for his successor to navigate the post-referendum future of the UK.
Naturally, the recruitment industry has much to say about the outcome of the vote, how this is likely to affect the economy, and the future of the recruitment industry.
Below we share some of the views from the industry.
Recruitment & Employment Confederation (REC) chief executive, Kevin Green, said, “The vote to leave the EU is likely to usher in a challenging period for British business and for the UK labour market in particular. Our data has shown a slowdown in hiring as we approached the Referendum. We expect to see this period of uncertainty continue.
“Nothing will change overnight. The Prime Minister’s statement this morning made clear that the Treasury is well prepared to support the markets and banks to ensure that business has liquidity. There will be a prolonged period of renegotiation and readjustment. During this time government needs to do everything possible to help businesses to grow and create jobs.
“That involves outlining a timetable of renegotiation to help organisations make informed strategic decisions. We call on policy-makers to set out the plan for implementing changes to employment regulations such as the Agency Workers Directive and the Working Time Directive.
“We need to ensure that British businesses continue to be able to get the people they need to fill the jobs available. Access to talent is absolutely vital to sustainable economic growth and prosperity. In sectors such as healthcare, education, hospitality, construction and manufacturing, workers from the EU are vital and any change to our immigration system needs to recognise that.
“We hope that today’s Referendum result leads to a step-change in the way we prepare current and future jobseekers in the UK, so that new entrants to the jobs market are better equipped with the skills and attitude that employers need. Employers, educators and government must seize the initiative and create a pipeline of talent so that individuals and businesses continue to thrive in the post-EU era. Over the coming weeks we will be consulting our members so that the recruitment industry is ready to play its part.”
Samantha Hurley, operations director at the Association of Professional Staffing Companies (APSCo), commented, “Britain has decided that the EU experiment, with its expansion into social and employment policy, hasn’t worked for this country, with 51.9% of the electorate voting to leave the Union. At this early stage, there is little detail on how Brexit will affect the regulation of the professional recruitment sector. However, this result brings the possibility that the Agency Workers regulations (AWR), and other inappropriate EU-derived legislation, could, at some stage, be reformed.
“Outside of the EU, UK courts will, in theory, have more latitude for interpretation to ensure that ‘one size fits all’ policy is reconsidered. While we strongly support the belief that potentially vulnerable workers should be protected, current rules focus on protecting lower skilled, lower paid workers and are of little benefit to professional contractors. APSCo will, of course, be working closely with Government regarding any changes, and will keep members abreast of all developments.
“APSCo members were polled on their voting intentions in February this year. 59% of respondents said they would vote to remain part of the EU, with 48% per cent believing that their business would suffer if Britain was to withdraw. APSCo has remained politically neutral throughout the campaign process, providing members with a balanced view of the UK’s place in Europe and evidence on how EU membership has historically both helped and hindered the professional recruitment sector."
Julia Kermode, chief executive of The Freelancer & Contractor Services Association (FCSA), said, "For FCSA it will be business as usual as we continue to work to raise standards in our sector to support and protect the flexible workforce in the UK that has been vital to the UK's economic growth in recent years. Leaving the EU will undoubtedly bring a period of uncertainty and as we have witnessed in the run up to this referendum demand for contractors has been high and I see this demand increasing particularly if the rules on immigration tighten up. We have seen significant impact on the stock market already today, and some concern regarding sectors traditionally reliant on the migrant workforce, such as construction. However, it should be borne in mind that exit will not be instant, stability is needed and now more than ever it is important to ensure that firms have the right skills in place. Once again, the flexible workforce will be key in ensuring the UK's economy doesn't suffer."
Paul Farrer, founder and chairman of media and digital recruitment specialist Aspire, said, “What was certain with a leave vote was that we will have a period of uncertainty. That is now underway although we should remember that we are still in the EU for at least two years but clearly not business as usual. I never thought we would win and now we have the result the most important thing is to unite the country and start constructive dialogue with the EU and as importantly the rest of the world. In the cold light of day, we are still the world’s fifth biggest economy and are now more in control of our destiny. Time will tell what we make of this opportunity. It’s sad for Cameron who has done a lot of good for the economy and most bets will be on Boris to become leader. For true democracy an election is needed which will create more uncertainty. Overall I believe we have to look at the long term and Brexit has put us in control of our own destiny. We should be good enough to capitalise.”
Peter Searle, chief executive of Airswift, which supplies staff to the energy, infrastructure and process industries, said, “The poll we conducted prior to the vote revealed that only 32 per cent of energy sector workers would have voted to remain. That said, this result could create uncertainty for North Sea operators, particularly around the need to source talent for projects in and around the EU. However, leaving the EU could ultimately signal a more prosperous future for the UK North Sea. Norway, a key player in the energy industry, already exists successfully outside of the EU and now it’s the UK’s time to carve out its own future.”
Ed Vernon OBE, chairman of multi-sector consultancy, Macildowie, stated, “As chairman of a business which operates in a sector uniquely connected to employment opportunities, I am surprised by today’s result. At Macildowie, we were aware of the impact leaving would have, with the associated uncertainty while the government renegotiates the UK’s position in the world. But this is the will of the people and the decision to leave the EU now creates an opportunity to pave the way for new approaches. I am optimistic about the determination and commitment of business leaders across the East Midlands and the UK as a whole to succeed. The Government now needs to listen to business to determine the best way forward. We are a nation of innovators and Macildowie will continue to partner with companies to build strong teams and ensure their businesses continue to be successful.”
John Hunter, chief executive of Argyll Scott, said, “Yesterday the people of the UK voted in a historic referendum with a momentous result that has left global markets and politicians across Europe reeling in shock. Whilst it is too early to tell what the short term and long term effects of this significant result will have on the UK employment market, Argyll Scott encourages politicians and business leaders to act decisively and responsibly to protect UK jobs, support UK based businesses and to secure the global mobility of talent. We will look to collaborate with fellow recruiters to work with government advisers and policy makers to ensure the UK’s future employment legislation continues to protect workers and enable businesses to secure the best talent to drive their future success and in turn that of the wider UK economy.”
Oliver Donoghue, managing Director of Swiss-headquartered NonStop Recruitment, recruits in the pharmaceutical, medical devices, care, chemical, technical, digital and education markets throughout Europe, said, “As we found out earlier today, Britain has decided to leave the European Union, with 51.9% voting in favour of the UK forfeiting its membership. For us an organisation it now means we must reassess our internal recruitment processes as EU freedom of movement laws have, up to now, allowed us to benefit from the skills of talent from across the single market. With this talent pool’s ability to move – both to and from the UK – potentially affected by the outcome of this vote, we, like many businesses, are waiting on outcomes of negotiations to see whether we will need to secure working visas or equivalent for our people. At this early stage there is little indication how freedom of movement laws, and other regulations, will be impacted so it would be remiss to suggest how the recruitment sector will be impacted. However, we will be working closely with our clients, and sector trade bodies, to ensure that the transition is as smooth as it can possibly be.”
Mark Mitchell, chief executive of multi-sector specialist Meridian Business Support, said, “The result is shocking and it’s a sad day for the UK. We now face a level of political instability and an uncertainty over who is going to be the next Prime Minister. As a country we will become less relevant. In the years to come, I expect we will experience a significant lack of investment in major industries as other countries won’t want to trade with the UK. Brexit means we are isolating ourselves and we may not seem favourable to other countries. The result makes us appear to be less friendly and tolerant and has turned many of our workforce into official immigrants than colleagues – this will have a detrimental effect on staffing. Brexit will have a major impact on start-ups and businesses. The economic impact will be damaging as we have cut ourselves off from a valuable source of skilled labour and we may have cut ourselves off from the single market. It’s going to take a lot of time, money and effort in order to get new trade agreements up and off the ground. But we have to respect the vote, and get on with it.”
Craig Allen, co-founder of The Change Group, said, "The result of yesterday's referendum was a shock as was Cameron's resignation. The subsequent crash of sterling and the markets should not come as a surprise as uncertainty is never a friend of the markets. We now face a period of ambiguity but I believe not much will change until we evoke Article 50 which there is a (small) chance may not happen.
"It's very likely, in my opinion, that Boris Johnson will step forward as PM candidate and will no doubt be a popular choice. He was a late decider on leaving the EU as I am sure you will recall and was a staunch voice in negotiating with the EU and our role within it. There is the strong possibility that the EU will try to get us back to the negotiating table (and make it difficult for us to leave) before article 50 is evoked. If this is the case, I'm confident Boris would like to draw up a new deal with them, which could see us in a stronger position and potentially even face another referendum.
"Over the next few months there will be much speculation and many ideas of what will/should happen. The recruitment industry will be effected in some sectors, notably finance, though we believe the hospitality market will stay relatively stable. The foreign nationals in the UK should not worry as it is unlikely their status will change but we may see a short term influx of EU nationals coming into the UK before any potential changes are announced. Should we not now look to renegotiate our deal with the EU then there will be a long period of debating about how we will fit into the global civil society and there will undoubtedly be some changes to the UK (possibly starting with the devolution of Scotland)."
Jo Sellick, managing director, Sellick Partnership, said, “As the UK, Europe and the rest of the world begins to come to terms with Britain’s decision to leave the EU, there are some important questions raised throughout the debate that we must begin to acknowledge. From a personal perspective, I must say I am shocked and saddened by the result and, while it was no secret that the polls were close, I am surprised by the scale of previously undecided voters who seem to have been swayed at the very last minute.
“The first, and possibly the most pressing issue, is what this decision tells us about the political landscape and the confidence - or lack thereof - that members of the Conservative party have shown in their leader during the past few months. Losing such an important argument surely suggests that it is time for David Cameron to resign his position. He was responsible for holding the referendum in the first place, so it is simply unacceptable to have done so and lost. But is there anybody who is ready and suitable to take his place? Boris Johnson is no doubt being viewed as a prime candidate and he will likely take a huge amount of credit for the Leave vote, having spearheaded the campaign. George Osborne’s loyalty to Cameron and the Remain vote will mean he cannot be seen as an option, so perhaps Theresa May will become a central figurehead for the party. Whatever the solution, it is clearly going to be a period of turmoil for the Conservatives and I would not be surprised if we see a vote of no confidence against the majority party in Parliament, leading to its dissolution and a general election. None of this will help public confidence and, in turn, the economy, which will surely falter even further during the next few months and years.
“From a recruitment perspective, I am extremely concerned that jobs could be at risk as a result of a weaker economy and so much uncertainty. This will affect candidates, clients and the industry as a whole. More specific to my sector is the wealth of legislation that has been set by the EU which is now called into question. Will we still have to follow legislation such as Agency Workers Regulations and the Working Time Directive, which came about purely as an EU incentive? These questions and many more remain unanswered and will likely be quite low down the priority list when it comes to negotiating on EU law, which governs so many aspects of British life.
“I am equally worried about what might happen to the EU workers who support so many sectors in the UK with their loyal and effective labour. Industries like agriculture, care and construction are all heavily staffed by non-British workers and these sectors rely on that manpower in order to thrive. While we have been reassured that people will not be ‘sent back’ to their home countries, we most certainly cannot expect that the same level of people from overseas will be entering the British workforce from now on. This could force the closure of many organisations, from the small farms who are staffed by EU workers and cannot hire locally for the same rate of pay, to larger corporations and even the NHS, which would seriously struggle to find the right skills at an appealing cost without the current volume of workers from Europe.
“Despite the many concerns I have about our future; I do believe there is no need to panic at this stage as it will be some time before we truly know the full ramifications of the vote. We now have two years of negotiations to determine the extent to which we remain part of the EU. In fact, it will surely take far longer than two years to plough through the raft of legislation that will need amending or creating in line with the vote to leave. During this time, it will be essential for our politicians and business leaders to unite to decide on the best actions for Britain’s future. The country has voted in favour of a detached, independent nation and now we must unite and avoid any further division within the country if we are to prosper in the way that the Leave camp has so confidently promised.”