The impact of Brexit on the UK labour market as it relates to the hospitality industry

We talk about the importance of understanding the labour market and its impact on managing employees on pages 282 to 284 of our book.  Currently the UK government’s decision to trigger Article 50 in order to leave the EU has resulted in this issue having a much higher profile.  One very good example of this is the publication today of a report* into the potential effect Brexit could have on the UK hospitality industry.

The report is 58 pages long so it is challenging to summarise in just one blog.  Here is what I found most insightful:

  • the Appendices provide an explanation of the methodology used to arrive at the report’s conclusions.  These are very helpful in explaining one of the major issues that arises from this report – namely the significant disparity between the Office for National Statistics (ONS) Labour Force Survey (LFS) data on employment in this sector, and KPMG’s own data derived from a survey of British Hospitality Association (BHA) members.  Hence the LFS estimates that 12.3% of the hospitality workforce is made up of EU nationals, whereas KPMG estimate this to be 23.7%.
  • Taking this higher figure and current levels of staff turnover and sector growth, assuming that after 2019 EU nationals will no longer be able to come to the UK to work in this sector, KPMG estimate that the industry will have a recruitment shortfall of 62,000 employees each year thereafter.
  • The UK labour market will not be able to fill this gap, as current high levels of EU nationals working in the industry illustrates.
  • the may be some improvement in productivity through automation, but this will have limited impact.
  • some local labour markets will be harder hit than others, London especially.
  • some industry sectors will be more affected, namely hotels and restaurants.

*KPMG (March 2017) ‘Labour Migration in the hospitality sector: a report by KPMG for the British Hospitality Association

Advertisements
This entry was posted in Chap 11 Jobs and people, Sector: Hospitality & Tourism and tagged , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s