Brexit hits transport labour market worst of any sector

London, UK: Transport and storage has been worst hit by labour shortages since Brexit with a shortfall of 128,000 EU workers, according to new research.

The 128,000 figure represents 8.45% of the total number of workers in the transport and storage sector. Other sectors badly affected include accommodation and food with a shortfall of 67,000 EU workers (4%) and construction with a shortfall of 67,000 EU workers (just over 2%).

The joint assessment from the UK in a Changing Europe and the Centre for European Reform think-tanks said that the ending of free movement was constricting the UK economy and “contributing significantly” to labour shortages in lower-skilled sectors, including logistics.

The research assessed the shortfall in workers by using data in the annual population survey to compare actual numbers of workers from the EU and the rest of the world against an estimate of the immigrant labour force had the UK not ended free movement. By June 2022 they found a net loss of workers equivalent to 1% of the UK workforce — about 330,000.

Jonathan Portes, professor of economics and public policy at King’s College, London, who co-authored the report, said the shift in migration patterns was “a feature, not a bug”. “The longer-term impact on the UK labour market will be profound,” he said.

At the end of last year the Cold Chain Federation, Logistics UK, UK Warehousing Association, British International Freight Association, Chemical Business Association, and RTITB sent a joint letter to the minister for immigration, Robert Jenrick MP, highlighting the industry’s critical labour shortage ahead of the upcoming Shortage Occupation List review.  

At the time, Alexandra Herdman, senior policy manager, Logistics UK, said: “Logistics UK is urging government to add forklift drivers, HGV drivers – of which there is an estimated shortage of 60,000 drivers – and warehouse operatives to the Shortage Occupation List in relation to the Skilled Worker Visa, as well as ensuring mechanics remain on the list.” 

Jane Gratton, head of people policy at the British Chambers of Commerce, has also urged the Home Office to reform the shortage occupations list.

“Politicians need to be realistic about the skills we need from outside the UK. Brexit has given us control of our borders and the government must use the appropriate levers to help struggling businesses get the people they need,” she said.

The impact of Brexit on the UK labour market: an early assessment