Tony Danker, the director general of the Confederation of British Industry [CBI], has called on ministers to look to immigration as a means of resolving labour shortages and the key to reinvigorating the UK economy.
Speaking at the CBI conference in Birmingham, Danker said that the government had to be “practical” and “honest with people” about immigration and allow for “economic migration” in industries with skills shortages.
Danker said: “We don’t have the people we need, nor do we have the productivity.
“First, we have lost hundreds of thousands of people to economic inactivity post Covid. And anyone who thinks they'll all be back any day now - with the NHS under the pressure it is - is kidding themselves.
“Secondly, we don't have enough Brits to go round for the vacancies that exist, and there's a skills mismatch in any case. And third, believing automation can step in to do the job in most cases is unrealistic.”
While the government has introduced seasonal workers schemes, a visa for healthcare staff, and a visa scheme for skilled workers in occupations that are struggling with labour shortages, business leaders feel measures so far have not been comprehensive enough to address the problem.
Immigration minister Robert Jenrick has suggested that the domestic workforce should be turned to as a “first port of call” where there is demand for “lower-skilled” labour.
He pointed out that there are five million people in the UK that are classed as economically inactive (not working nor looking for a job) and that these could be upskilled and reintroduced to the workforce.
Jenrick said: “If they want to or can return to the workforce, we want to give them the skills to get back into it and British employers should be helping us to do that.”
He also insisted that the government’s ambition was to “bring down net migration” and that doing so was a matter that was “very important to the British people.”
Jenrick’s comments echo those made by chancellor Jeremy Hunt last week, who said that immigration would be important for the economy but that it was still important for ministers to bring the overall numbers down over time.
The chancellor also highlighted the need to upskill people “at home” to reduce dependence on foreign labour to fill vacancies, which stand at record levels.
Figures published by the Office for National Statistics suggest that net migration to the UK stood at around 239,000 in the year to June 2021, compared to 260,000 in the previous year. This was largely driven by immigration from beyond the European Union, following Brexit.
The UK’s exit from the bloc brought the end of freedom of movement, which made it harder for businesses to recruit workers from the continent.
However, a recent CBI survey shows that almost 75 per cent of respondent businesses had struggled with labour shortages over the last 12 months, with almost half favouring more temporary visas being issued to foreign workers to fill vacancies in industries with acute shortages.
With the economy in recession and smaller than before the Covid-19 pandemic, Danker has called on the government to turn to further immigration to help, pointing out that it was “the only thing that's increased the potential growth of our economy since March”.
Danker said: “Growth is a precondition to a stable society. Without growth the NHS gets worse not better. People's lives get worse not better. And we lack the resources we need to transform ourselves to a zero-carbon world.
“Yet Britain's had 15 years of low growth and flat-lining productivity. We can't afford a repeat.”
Elsewhere, Brexiteer Lord Wolfson, the boss of retailer Next, has blamed the country’s current immigration rules for stifling growth and called on ministers to open pathways for more overseas workers to fill vacancies in the workforce.
Photo by Christopher Burns on Unsplash
