Photographer: Simon Dawson/Bloomberg

Brexit Mustn't Shut Door on Unskilled EU Workers, Retailers Warn

  • U.K. retailers may not meet demand without migrant labor
  • Risks include Christmas shopping shortages, unharvested crops

Christmas shopping may get more hectic and crops might go unharvested unless the U.K. government ensures access to unskilled migrant labor after the U.K. leaves the European Union, the British Retail Consortium warned.

The government must make it easy for workers from the EU currently living in the U.K. to secure settled status and establish an immigration system that allows retailers to retain access to unskilled workers, the lobby group said. Failure to do so could lead to less choice and higher prices in shops, according to the BRC.

EU nationals make up two-thirds of the permanent workforce in the U.K.’s food and drink supply chains, according to the BRC. Tesco Plc Chief Executive Officer Dave Lewis said last week that agricultural labor shortages are among the biggest Brexit-related risks facing the U.K.’s largest retailer. The fall in the pound and concerns that they will not be welcome have made it less appealing for seasonal EU workers to head to Britain, he said.

“There is some genuine concern that farmers don’t have the labor they need to pick the crops,” Lewis said.

In formulating a new immigration system the U.K. government needs to attempt to respect the outcome of the Brexit vote while limiting the short-term impacts on economic growth. A leaked immigration paper from Prime Minister Theresa May’s government last month outlined its intention to limit the residency of low-skilled migrants from the European Union to two years, immediately after Brexit.

Retailers, as well as companies in the hospitality, manufacturing and construction sectors, would be hurt by an immigration system that discriminated against lower-skilled workers. In addition to the 170,000 EU nationals directly employed in the industry, which is 6 percent of the total workforce, retailers lean heavily on temporary migrant labor to meet demand over the Christmas period or during peak growing seasons.

Some 83 percent of U.K. retailers employ unskilled EU nationals and 22 percent of retailers have already had EU workers leave the country as a result of the uncertainty surrounding their future rights, the BRC said.

“The U.K. unemployment rate is at a historic low and many of those who are unemployed are long-term unemployed,” said Helen Dickinson, chief executive officer of the BRC. “The idea that the U.K. has a ready pool of workers to fill the gaps is very unrealistic.”

Seb James, CEO of electronics retailer Dixons Carphone Plc, has said plans to curb low-skilled migrants are unworkable due to the labor shortages it would create for businesses and the National Health Service.

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