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Immigration Crisis Follows Brexit: Economic Shock Ahead

Herald Publishers by Herald Publishers
October 14, 2021
in Economy
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Immigration Crisis Follows Brexit: Economic Shock Ahead

Immigration Crisis Follows Brexit: Economic Shock Ahead

Brexit will allow the UK to take back control of its borders and restrict EU immigration in a way that has not been possible for decades. But the government and, in particular, the Home Office, must be ready for a transformation if they are to rise to the challenge.

Taking back control of immigration is about much more than just designing and implementing a new immigration system. Over the past 15 years, the UK has come to depend on the free movement of workers from the EU to meet skill gaps and manpower.

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Difficulties were apparent even before Britain left the EU. Nurses and care workers from Europe have been leaving the UK in higher numbers since 2016. In agriculture, difficulties recruiting workers for the soft fruits industry have resulted in considerable losses as produce rots unpicked in the fields.

The Impact of Brexit on Businesses

Scottish businesses already face challenges in attracting and retaining talent on all skill and salary levels. This is in partly driven by demographics, but also the smaller scale of Scottish industries. According to official data, there were 18,000 vacancies in Scotland in 2017 relating to specific skills, and a further 23,000 hard-to-fill vacancies due to general labour shortages.

A no deal Brexit will bring an end to the free movement of labour between the UK and the EU and make these challenges harder for Scotland. It may lead to formal restrictions on the movement of manpower, alongside declining perceptions of the UK (including Scotland) as a place to live.

Most importantly, the impact of more restricted movement by EU workers to Scotland is likely to be disproportionate relative to the UK, due to factors including the scale of market and physical location, and the potential that the salary may be used as a proxy for skill levels in a new UK immigration system. Sectors which reported they were most likely to be impacted include food and drinks, life sciences, financial services, and creative industries.

EU immigrants make up a notable share of employment in a number of sectors, including agriculture (where there are around 10,000 seasonal migrant workers engaged in Scottish agriculture), and the life sciences (accounting for 17% of the workforce.) Retaining non-UK workers is critical to many Scottish businesses. A no deal Brexit will see the end of the free movement of labour between the UK and the EU. This presents a challenge to Scotland given the current and anticipated demographic challenges it faces. Scotland’s population is ageing more rapidly than the UK’s as a whole, which suggests that the size of the domestic labour force will continue to shrink over time.

Scotland’s Need for Skilled Migrant Workers

The Scottish government claims that Scotland needs the continued movement of EU citizens , to deal with a ‘skill gap’.

A 2010 report found that 15% of Scottish reporters stated that they were impacted by skill gaps. However, a report by Scottish Government Social Research added that ‘most skill gaps are transitory because the employee has not been in the job very long (61%) and/or because they have not yet completed their training (47%)’.

Scotland’s journey to EU membership will be deeply linked with the construction of the Scottish state. In the post-referendum transition and formative years of independence, it would establish government departments (such as a department for European and external affairs) and state architecture such as a comprehensive system of taxation, central bank and competition authority. It would also ensure a stable basis for UK parliamentary legislation to remain within Scottish law and undo whatever divergence from EU law has taken place in the Brexit era.

These measures would all be direct or indirect requirements for EU membership. Excellent domestic preparations would facilitate more expeditious negotiations for accession.

The EU and Scotland could conclude an Association Agreement for their relations after Scotland becomes independent and presumably exit the EU-UK partnership. Provided that the EU, UK and Scotland all consent, it is possible that discussions on this agreement could take place during the transition to independence.

Accession to the EU happens via a treaty between the candidate country and the EU represented by the commission. The treaty requires unanimous approval by the council – i.e. each member state has a veto – and support from a majority of European Parliament members.

The EU requires that candidate countries comply with the three so-called Copenhagen criteria:

  • Political criteria relating to the stability of institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities
  • Economic criteria, i.e. a functioning market economy and the capacity to cope with competition and market forces
  • An adoption of the entire EU acquis
  • Additionally, the EU must consider itself to have the capacity to absorb new member states

Increase in market size: As a result of the freedom of movement of goods and services, UK to any of the other fourteen countries without facing extra costs or restrictions on the types of products they sell.

Greater access to cheap factors of production (e.g. raw materials, technology and labour): A business can employ individuals from any part of Europe. Football clubs have certainly benefited from this! The National Health Service has found this a good source of skilled doctors and nurses when they have had shortages of medical staff.

Access to EU government contracts: not just UK government contracts, benefiting businesses who sell goods and services to government departments (e.g. road builders could be “contracted” to provide roads in Spain).

Brexit Problems Halt Some Scottish Seafood Exports to the EU

Deliveries of Scottish seafood to the EU from smaller companies have been halted until Monday, 18 January, after post-Brexit problems with health checks, IT systems and customs documents caused a huge backlog.

Scottish fishing has been plunged into crisis, as lorry-loads of live seafood and some fish destined for shops and restaurants in France, Spain and other countries have been rejected because they are taking too long to arrive. The industry’s biggest logistics provider, DFDS, a Danish company, pointed to delays regarding health certificates, issues with the IT system interface between the group and local authorities, and incorrect or missing customs documentation from customers.

New Brexit rules require every box of seafood and fish to be offloaded from lorries and inspected by vets before it leaves Scotland. It has taken business owners five hours per lorry to obtain a health certificate, which is required to apply for other customs paperwork.

Brexit Could Cost Scottish Economy £16 BN a Year – Report

The updated analysis warns that a hard Brexit, in which the UK falls back on world Trade Organization rules, would cost Scotland up to £12.7bn and cause real household incomes to fall by 9.6%, or £2,263 per head.

In contrast, staying in the EU could result in the growth of the UK economy. That growth will improve Scotland’s situation.

Scotland to be ‘Worst Hit’ by Brexit Disruptions

Scotland is at most risk of disruption to food and medical supplies if ferry ports are hit by “pressure and problems” as a result of a no-deal Brexit, MSPs have been warned.

Scotland is facing considerable and imminent damages, which will disrupt its economy and society.

Post-Brexit Immigration Changes Disastrous for Scotland, Minister Warns

Rules over immigration being proposed by the UK government would be ‘economically disastrous’ for Scotland, MSPs will hear. Home secretary Sajid Javid unveiled plans to re-shape the UK immigration policy after Brexit with the publication of a white paper in December. “The free movement of people within the EU has been of enormous benefit to Scotland. It has allowed people from across Europe to settle here with their families, and play full and vital roles in our economy and as part of our communities. The current immigration system does not meet Scotland’s distinct needs and the UK government’s proposals would be highly damaging.”

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