Consequences of Brexit Are Surfacing as UK Faces Severe Labor Shortages

In November, the Office for National Statistics reported that more than 13 percent of businesses in the U.K. were experiencing labor shortages. That number has been something of a constant since the fall of 2021, when much of the economy began reopening after the extended pandemic lockdowns. In some industries, however, the numbers were far, far worse: more than one-third of restaurants and hotels reported they couldn’t find enough staff — with a quarter of pubs, restaurants and hotels forced to shut during days that they used to be open because of worker shortages — and more than one in five construction companies reported problems hiring workers.

Recently, The New York Times reported that Britain was facing a labor shortfall of 330,000 workers, with agriculture particularly devastated. The article cited fallow fields that hadn’t been planted, and crops left to rot in ones that couldn’t be harvested, owing to the paucity of migrant workers.

Food prices are soaring in the U.K., at a faster clip than in the U.S. and the European Union (EU), as farms face labor crunches. Britain faces a shortfall of between 70,000 and 100,000 truckers, making it harder to transport produce.

Not coincidentally, agriculture is among the core industries that, prior to the 2016 Brexit vote, had become disproportionately reliant on immigrant workers from within the EU. Between 2003 and the end of 2019, when Brexit’s harsh measures actually began kicking in and EU workers started losing their automatic right-to-live-and-work-in the-U.K. status, the number of residents in the U.K. from eight Eastern European countries increased tenfold, from 136,000 to 1.3 million. The majority of these workers came from Poland. Another half-million residents arrived from Bulgaria and Romania after those two countries were admitted into the EU in 2007.

By the time of the Brexit referendum, in June 2016, EU migrants made up 6.8 percent of the British workforce, up from 2.6 percent in 2006.

According to data generated by the Agriculture and Horticulture Development Board, by 2015, one in five workers with permanent jobs in agriculture were European Union migrants; but, on top of that, many seasonal workers in the industry (those who pick crops at harvest time) came from outside of the U.K., mostly from Eastern Europe. That same report detailed that nearly 40 percent of workers in the manufacturing of food products were migrants; one in three home helps were migrants; nearly 30 percent of those in the garment industry came from overseas; and more than a quarter of restaurant employees were migrants.

Since Brexit, large numbers of these workers have returned to their home countries, or gone elsewhere within the European Union. In the years between the Brexit vote in 2016 and the ending of free movement three and a half years later, the Migration Observatory at the University of Oxford estimates that net migration from the above-mentioned eight Eastern European countries declined to almost zero. The Observatory’s researchers believe that in 2020 alone, 94,000 more EU citizens left the U.K. than moved to the U.K. The net out-migration continued in 2021 and in 2022, and will likely continue this year as Britain tightens the screws on EU citizens’ movement into the U.K.

Meanwhile, there has been a huge upswing in non-EU migration into the United Kingdom, leading to near-record immigration numbers last year, but this hasn’t so far made a dent in the cascading labor shortages, or in dislocations in specific sectors of the economy where EU migrants had established a foothold, that the country faces post-Brexit and post-pandemic lockdown. More than 4,000 doctors have quit their jobs in the U.K. and returned to the continent post-Brexit, according to the Nuffield Trust think tank, contributing to a worsening crisis of access to health care services in the country. Meanwhile, an astounding 96 percent of supply chain firms recently reported that they were impacted by shortages of skilled laborers.

The result of this mismatch between labor needs and labor supply is a series of massive stress tests on the U.K. economy, one that, when combined with Russia’s war in Ukraine and ongoing uncertainties caused by the pandemic, is leading to huge disruptions in critical sectors of the economy. This is worsening the U.K.’s inflation problem and also weakening the country on the international stage.

For the first years after the Brexit vote, public opinion on Britain’s exit from the EU remained roughly constant, with a small majority supporting the process. Now, however, things have become so bad that many Brits are having second thoughts. Over the past year and a half, majorities of voters have told pollsters that they think leaving the EU was the wrong path to take. Recent polls have shown about 54 percent opposing Brexit, only one-third supporting it, and about 12 percent answering that they don’t know.

If there were a do-over election tomorrow, Britain would almost certainly vote to get back together with its European partners. As a result of shifting public sentiment, there is a window here for a reengagement with the EU. The Conservative Party won’t go near this opening, as it would alienate its nationalist base — in much the same way as the Trumpist GOP in the United States won’t contemplate sensible immigration legislation. But there will be a general election within two years, and all the polls suggest that the Conservatives will lose, and that Labour, the Liberal Democrats, the Greens and the Scottish Nationalists, all of them left-of-center parties, will increase their parliamentary representation.

If Labour forms the next government, as the polls suggest is probable, it’s unlikely that its members will want to reopen the Brexit wounds by immediately holding another referendum and then applying for rapid entry back into the EU. After all, Labour itself was internally divided over how to respond to the Brexit referendum, and for many years the left of the party critiqued its leadership under Prime Ministers Blair and Brown for flirting with neoliberal economics, underinvesting in public services, failing to adequately address rampant economic inequality, and for standing by while many jobs were outsourced to lower-paid workers, many of them from overseas — all of which contributed to the surge of anti-EU sentiment that culminated in Brexit. Brown, himself, while being firmly pro-European, wasn’t averse to at times also trying his hand at populism, and to stirring anti-EU sentiments among voters, at one point, in 2009, referring to “British jobs for British workers.”

Nevertheless, for all of Blair and Brown’s faults, Brexit is, by and large, the offspring of Conservative Party governance, and the consequence of a civil war within that party between pro- and anti-EU forces. If Labour comes to power, it will have to deal with the economic mess that the Conservative Party’s internal conflict ultimately led to. Faced with the ongoing and escalating economic fallout from Brexit, from the pandemic, and from Russia’s war against Ukraine, it seems increasingly likely that if a new government is elected in late 2024 or 2025, it will have to start strategizing some form of long-term reengagement with the EU. Such an agreement could resemble those held with Norway, Switzerland and Iceland, whereby the country remains technically outside the EU but agrees to abide by freedom of movement and of labor in exchange for securing access to Europe’s single market.

That’s where Britain should have ended up after the Brexit vote in 2016, and it’s where it likely would have ended up had Boris Johnson not chosen to embrace a so-called “Hard Brexit” as a way to consolidate his hold over the Conservative Party base. Now, nearly seven years after that self-destructive vote, Britain is caught in a vise of its own making, experiencing an exodus of EU workers who have for the better part of two decades kept large parts of the economy humming along, and attempting to navigate a vast array of economic headwinds without any of the benefits of scale that come with membership in the world’s largest single market.

Proponents of Brexit argued that the divorce from the EU would lead to Britain “reclaiming control” over its economic destiny. Instead, the country’s economy is growing at a slower pace than that of any other G7 nation and likely to actually contract this year, its inflation rate is the second-highest of the G7, and major industries are experiencing rolling strikes. It’s all a very long way from the glorious future promised by Brexiteers during their mendacious referendum campaign of 2016.