The Brexit Column: Avoiding an Exodus | KPMG | UK

The Brexit Column: Avoiding an Exodus

The Brexit Column: Avoiding an Exodus

Understanding the myriad motivations of your EU-born staff is not just kind, it’s smart business practice, says Mark Essex

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Director, Public Policy

KPMG in the UK

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The House of Lords vote this week came as no great surprise. Yet their amendment to guarantee the rights of EU nationals living in the UK after Brexit is just the start of the journey. 

In the meantime, business has its own job to do. What the coverage of the upper chamber’s vote highlighted is the human side of Brexit. Forget all the pre-Article 50 talk of bargaining chips and playing cards. Each of the 2.9 million EU nationals based in the UK has their own individual reasons for being here, their own unique story to tell. And what many are saying right now is that they fear for their future and, in some cases, are unsure they even want to stay.

How should companies respond? All employers should sit down with members of staff on a regular basis to understand how they feel in the job. Appreciating the views of their EU-born workers in those conversations will be especially important right now as Brexit proper begins. That is not just because good employers should provide support and pastoral care, but because it will help businesses establish whether they are about to face a potential exodus of labour – even before the UK leaves the EU, probably two years from now. 

Migration is, after all, a two-way street and already small warning signs are there. Last week’s Economist reported a four-fold increase from January to September last year in the number of EU workers who failed to show up for UK agricultural jobs they had previously accepted.

Across our international network, we've heard of myriad reasons for that. The fear factor is clearly one. If you’re a young family from Vilnius looking to build your life in the UK – or a hot-shot lawyer from Madrid now convinced you’d have a more promising career elsewhere – you may well vote with your feet, not wait for politicians to decide your fate. 

Some EU citizens are also confused about whether they can remain in the UK, even as the UK remains an EU member for the next two years, once Article 50 has been triggered.

Then there’s the plummeting pound. For EU nationals sending remittances back home or, say, saving up for a house there, sterling’s 18% fall may suddenly render the whole point of being here redundant, particularly if their home economy is booming. According to Bloomberg, 200,000 Poles may now head home – a quarter of the UK’s Polish diaspora – with unemployment in Poland down to a record 5.5%. 

And don’t forget that aspiring EU citizens have 27 other countries to choose from: with some Europeans saying they feel less comfortable in the UK these days, there are plenty of other EU states ready to welcome our farm workers and fintech entrepreneurs. 

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Listening and learning

Businesses can’t, of course, influence many of these factors. Nor can they offer any cast-iron guarantees. But they can – and should – be engaging actively with EU staff – as with all employees – to understand their motivations and fears: why they’re here and what would make them stay, or leave.

Picking up trends after looking at all those conversations together will help companies formulate a response. For example, there might not be a huge amount companies can do if workers are saying the weaker pound makes it uneconomic for them to stay. But, at least armed with that information, companies know to crank up their recruitment machinery or, with a relatively tight UK labour market and low productivity, consider where it is appropriate to automate some processes. Elsewhere, a simple conversation of reassurance and setting out their rights and explaining the Brexit process, might be enough to head off an outflow of staff. Too few employers are having these conversations.

Businesses should also contribute to the wider debate. That includes the government’s newly announced – and warmly welcome – plans for a consultation exercise over the summer involving business and industry bodies to help shape its new immigration system. KPMG will be working closely with clients in this process to air their concerns. I would urge you to do the same. 

Will we see a stampede towards the exit over the next two years? Unlikely. There are many reasons why people are attracted to a life in the UK and bringing up a family in a stable, open society. The English language also has a singularly powerful pull. But, the more firms do now to understand the motivations and emotions of their EU staff, the higher the payback will be.  

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This article represents the views of the author only, and does not necessarily represent the views or professional advice of KPMG in the UK. You can register for the email subscription list of this column and expert views from our Brexit leaders.

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