Part 4 of a 6 part Food and Drink Brexit series: Talent and skills

12 _Dec

Posted by: Richard Walters Monday 12 December 2016 11.11

Part 4 of a 6 part Brexit series

It is too early to predict with any certainty how Brexit may impact businesses, particularly without clarity on exit terms. However, businesses can consider the emerging scenarios that may arise as result of UK-EU negotiations. The extent to which firms are affected by, and can react to these scenarios, depends on a number of factors including geographic scale, levels of existing investment in the UK, and industry sector. Until then, the UK will continue to have full access to the single market without any tariffs or regulatory restrictions.

This six part Brexit series examines some of the key focus areas that businesses should consider when looking at their supply chains and longer term growth strategies.

Part 4: Talent and skills

A points based immigration policy will likely reduce the flow of low cost labour into the UK and drive manufacturing and retail wages up in the longer term. UK food and drink Manufacturers, as well as UK agrifood producers face significant challenges around this, also magnified by the impacts of an increasing minimum wage. Business could look to shift their operations abroad, or relocate to other areas of the UK to find lower cost labour pools.

Although favoured by a points based system, highly skilled engineering and technical labour may decide the uncertainty around their future role and prospects is such that the UK is no longer the country of choice. The UK is unlikely to be able to fill these skills gap quickly, meaning firms could face complex and expensive visa sponsorship processes in order to import the right skills. .

What should businesses consider and what can firms do now?

Understand your exposure to an increase in the cost of low skilled labour. What steps can you take to make your operations more efficient and/or less labour intensive? How can you increase the rate at which existing efficiency improvement projects deliver? How does the business case for automating parts or all of your operations change when taking into account possible labour cost increases?
What capabilities will your firm need in 1 year, 3 years and 10 years? How is that different from today? What ‘pipeline’ is in place to develop this talent and address any gaps, and what employment package will be needed to attract the best talent?