A recent study conducted by the CIPD has found that the post-Brexit immigration system in the UK has not led to an increase in the recruitment of local workers. The research indicates that
only 15% of employers have utilized the points-based immigration system to sponsor migrant workers since its implementation in January 2021. While the system appears to work adequately for hiring highly skilled workers, many employers continue to face labor shortages.
According to the CIPD analysis, approximately 57% of employers still struggle to fill vacancies that require specific skills. Interestingly, organizations that have sponsored migrant workers under the new system were found to be more proactive in addressing skills shortages. For instance, 34% of these employers have hired apprentices, compared to 23% of those who have not sponsored migrant workers. Similarly, 28% have recruited UK graduates, and 23% have increased investments in automation.
The study also revealed that employers who sponsored migrant workers exhibited greater workforce diversity. Three-quarters of these organizations had recruited Black, Asian, or minority ethnic employees, compared to 52% of those who did not sponsor overseas workers. Moreover, 29% hired individuals with a history of long-term employment, and 57% recruited people with disabilities or long-term health conditions.
Ben Wilmott, the head of public policy at the CIPD, expressed disappointment that the points-based immigration system failed to encourage investment in local workers as intended. Wilmott emphasized the need for closer collaboration between the government and employers to address policy shortcomings, including the apprenticeship levy, to support the employment and training of UK-born workers.
Despite its limited impact, over half of the employers surveyed (54%) considered the system effective in addressing skills shortages, while 34% believed it was ineffective. However, concerns were raised regarding the administrative time and costs associated with the sponsorship system, with 48% and 44% of employers expressing reservations, respectively.
Wilmott highlighted the necessity for broader action to align skills policies with the industrial strategy. He advocated for reforms in various areas, such as skills, innovation, business support, statutory sick pay, and labor market enforcement, to enhance labor market participation, training, and productivity growth across all sectors of the economy.
The CIPD put forward several recommendations for the government, including regular reviews and potential expansion of the shortage occupation list, extending the Youth Mobility Scheme to include EU nationals, and improving the user-friendliness of the points-based system for employers to reduce time and costs associated with sponsoring migrant workers. Additionally, the CIPD advised reforming the apprenticeship levy into a more flexible skills and training levy, enhancing local support for small businesses in people management, and developing a refreshed approach to skills policy and industrial strategy. Photo by Phil Whitehouse, Wikimedia commons.