Brexit uncertainty accelerates UK’s SME “Brain Drain”

The term “Brain Drain” has been used periodically in modern British history.

It’s perhaps most commonly associated with the concerns of the 1940s-60s, that the country’s top and most highly qualified professionals were emigrating in large numbers to countries such as the USA, Canada, Australia and New Zealand. That was seen to be happening as a result of the UK’s rapid post-imperial economic decline.

Although the term has been used since it has come to prominence again following the 2016 Brexit referendum decision.

Brexit – what effect is it having on SME’s access to talent?

Much of the discussion of this in the media and elsewhere is subjective and influenced, to some extent, by whether the originators are politically pro or anti Brexit. 

However, there is widespread concern in many industry sectors, supported by some statistical evidence, which suggests that Brexit IS having a negative effect on companies seeking to attract and retain the top talent: 

That might be particularly true for SMEs.

Why is there an accelerated effect?

Some point out that those with professional skills have always moved and worked internationally. They did so before the EU existed and will do so after (if) the UK exits. For example, travel in the EU, including the UK today and you’ll find hundreds of thousands or possibly millions of non-EU citizens working in key roles.

One argument goes – “why would that change in the specific case of the UK, as it approaches a full exit?

Intuitive as that argument may appear, there are a number of causative factors that make Brexit simply different though:

  • uncertainty. Top professionals looking for permanent positions want to think of medium to longer-term commitments. Wondering whether or not their status might move from one where continuity of right to work exists automatically to one where it’s open to government approval, will discourage many existing EU nationals from thinking of the UK as a prime career target;
  • stability. For many centuries the UK has been perceived as arguably Europe’s most politically and socially stable country. The Brexit-related chaotic events in government circles since 2016 have started to question that assumption going forward;
  • mobility. Currently, EU professionals know they can seamlessly move across national borders as their work requires. That may be more of a challenge post-Brexit;
  • economic worries. Many people fear the short to medium-term impact of Brexit on our economy. That might result in fewer opportunities.

In fairness, some non-Brexit causes of the Brain Drain also exist. Emigration to higher living standard and greater opportunity economies has always existed. Even so, Brexit will have added significantly to this challenge for UK employers. 

What specialists will be affected?

Potentially any highly-qualified and experienced professional may choose to think about their future as a result of the Brexit position. That tendency might affect skilled individuals from wide backgrounds:

  • EU nationals currently permanently employed in the UK may, for the reasons mentioned above, seek to find new positions in EU member states;
  • UK nationals, like their forebears in the 1940s-60s, may start to think of the UK as an economic backwater and see far greater opportunities in the EU or elsewhere;
  • many EU nationals who might have been considering looking for a career in the UK, may well now be looking elsewhere;
  • some non-EU nationals who might be working in the UK or considering doing so might be more tempted by EU destinations as insurance of future mobility.

Is this real or is it “project fear”?

As said at the outset, indisputable facts are hard to come by. However, it seems as if there is growing evidence to suggest a real skills shortage is approaching:

The conclusion must be that this is a serious issue and one all companies looking for expert-level people will need a strategy to deal with.

How this hits SMEs particularly hard

Large corporates have always been able to deploy their cheque books and large financial resources to offset, in part, skills shortages. No doubt that will continue post-Brexit and it will help them to mitigate some of the worst effects. 

For SMEs though, the position is very different. Typically, they don’t have the financial resources to enable them to take part in “bidding wars” for the reduced numbers of skilled personnel that may be on the market.

So, they’ll need a different strategy.

Here, I’m proposing the following core realities:

  • many SMEs will need to move away from the presumption that getting in the required skills means permanent employment. They won’t be able to compete. Inevitably, they will be forced to consider the greater use of contracted and consultancy expertise;
  • some “out of the box” thinking will be required about engagement. Things such as teleconsulting will need to be used to keep costs down through the “sharing” of critical expertise between a number of organisations;
  • new project planning and management paradigms will be required to more effectively exploit consultancy expertise provided via modern channels. This will require a significant change in the cultural and leadership mindsets of many of today’s SMEs. The days when expensive and scarce expertise can be kept “bottled up” behind a desk for 5 days a week to be used as and when required, may be gone forever.

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