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Business after Brexit: how can hospitality close the labour gap?

By Tijen Ahmet

- Last updated on GMT

Business after Brexit: how can hospitality close the labour gap?

Related tags: Hospitality, Recruitment

The Youth Mobility and Graduate Visa schemes can offer a short-term fix to the hospitality skills gap, but longer-term solutions are needed.

With the right to work and live in the UK now more restricted for EU citizens, many employers will be considering the impact this will have on their recruitment strategies. Recent scenes of people being detained at the border - some with scheduled job interviews in the UK - have left those in the hospitality sector reconsidering the future of their workforce.

Brexit and the pandemic have both exacerbated the issues that have long plagued the hospitality sector, such as retaining and attracting workers and having a reliance on foreign labour. Extended periods of furlough have seen staff seeking work in other sectors, and now that EU citizens and employer’s face a more complex immigration process, it will be a challenge to fill the gaps, especially for those businesses which rely on large numbers of staff.

For hospitality venues that are looking to tap into the EU workforce, it’s vital to be aware of the new entry requirements. To work in the UK, those from the EU now need a work visa, which may require sponsorship. To sponsor somebody, a business must have a sponsor licence, so this needs to be a consideration from the outset as it does carry a financial cost. Workers themselves must also meet the skill and salary levels set by the Home Office to comply with the new points-based system. Due to the number of low-skilled roles in the hospitality sector, this could be a considerable barrier.

Currently, the Home Office has set a minimum salary threshold of £25,600 per year, although migrants can apply with lower wages and effectively fill the missing points by other means, such as qualifications or experience. When it comes to the required skillset, the minimum level required is RQF3, which is the equivalent of a job at A-level. For hospitality, these requirements may be difficult to achieve, particularly regarding salary. Further complications come with the fact that the position offered must be full-time for a person to be eligible for a skilled worker visa. With many bars and restaurants relying on zero-hours contracts, this could lead to a significant change in the way the hospitality industry approaches recruitment.

As restrictions ease further, and the industry returns to pre-pandemic levels, holes will begin to show. In the short-term, managing staff shortages in areas such as waiting tables and food preparation will be the main hurdles for venues and management teams.  

Longer term, there could be changes to the wages of hospitality staff, so they meet the Home Office visa requirements, and changes to popular foreign talent pools, with the UK developing new bilateral relations with other countries, such as Australia. Although these won’t necessarily be detrimental, the changes will require the whole industry to adapt. Increasing wages to meet the visa salary requirements also runs the risk of becoming a substantial overhead for businesses that are still recovering their finances following the pandemic.

One option for businesses looking to rapidly plug a skills gap is the Youth Mobility Scheme. This scheme functions similarly to a working holiday visa but is only available to those between 18 and 30 years old and has a limit of up to two years. Although not currently available to EU nationals, it’s expected that this will be expanded in the future.

Another option which may make it easier for hospitality businesses to source staff is the Graduate Visa Scheme. Launching in July 2021, this is aimed at international graduates already living in the UK and allows successful applicants to work in the UK without needing a sponsored visa. This is a temporary solution with degree-level students able to stay for two years, and PhD students able to stay for three. However, sponsorship can be easier to gain at the end of the set period if this route has been used, meaning it can be a better option for hospitality venues in the long run than the Youth Mobility Scheme.

Both solutions are a short-term fix and there is currently a lack of long-term options under the post-Brexit immigration regime, so although these schemes are better than nothing, the hospitality industry still has challenges ahead.

Of course, the situation is subject to change, and as the longer-term impact of Brexit and the pandemic begins to show within the hospitality sector, accommodations could be made by the Home Office. For this reason, it’s important that any particular areas facing extreme difficulties in recruiting workers are flagged to the Migration Advisory committee (MAC) who call for evidence and make recommendations to the government on immigration policy and particular on the Shortage Occupation List.

If job roles are placed on the list, those applying for the role won’t have to meet certain salary requirements, making gaining a skilled worker visa more straightforward. This could be crucial in narrowing the labour gap in the hospitality industry, although it cannot be solely relied upon.

Brexit has taken a massive toll on hospitality and the pandemic has further aggravated existing problems. However, it’s not all doom and gloom, with 5.5 million EU citizens having already applied to the EU Settlement Scheme, enabling the hospitality industry to move forwards with those already living and working in the UK.

Tijen Ahmet is legal director and business immigration specialist at law firm Shakespeare Martineau

Related topics: Advice

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