It’s been over a year since the shock result of the Brexit referendum was announced, and now that the dust has settled & negotiations have commenced with the EU, we thought we’d take a look at the likely impact on the Retail sector, an area, alongside FMCG, in which we have provided recruitment services in for many years.
Our retail clients are already hard at work, assessing the likely impact of the impending break with the EU in areas such as supply chain and HR. Undoubtedly, regulations are going to change & retailers will need to assess their existing positions, as well potential negotiation outcomes so they have several options available. This will allow them to assess in advance the various possible options the government could agree on over the next two years and have a plan of action for any eventuality.
How will the Retail sector recruitment landscape change?
Shrinking Talent Pool?
Retention of talent within businesses will be key going forward, especially considering that the supply of EU workers coming to the UK will more than likely stagnate due to new restrictions on free movement of labour in the EU zone. However unlikely it is that all EU citizens currently legally working in the UK would be forced to return to return to their country of origin. We do expect businesses will find it harder to recruit people with the skills sets they require in the short term. Retail professionals may be less attracted to work in the UK because visa changes could mean they will be limited to working in the same place for a few years before having to return to their home country.
Increasing salary inflation?
We don’t have a crystal ball but the likely outcome of a skills gap in the retail sector probably means upward pressure on salaries. In addition, the salary threshold required to apply for a permanent residence visa in the UK was increased to £35,000 in April 2016, meaning that roles falling into the £25,000 - £40,000 band may well see talent shortages when you combine this with reduced numbers of EU nationals entering the country.
Back of house automation
It is possible that retailer investment in automation of their supply chains will increase as a direct result of the reduction in the numbers of unskilled EU workers. Some businesses of course have made big advances in this area – companies such as Amazon and Ocado are pushing the boundaries of technology and are looking to reap the rewards in the future.
Can Retail and FMCG businesses hedge against any future ill effects of Brexit?
The most important thing is to ensure you have the best talent in your company now, and maintaining a strong company brand & culture to retain your existing talent is key.
If you identify any existing skills gaps, you should look to fill these either by an external specialist recruiter like ourselves or use in-house training of existing employees to help them realise their full potential.
The candidate marketplace is a moving feast so plan ahead & continuously update your recruitment requirements, at the same time as keeping your eye on what is available externally, so if needed you can take action at short notice.
If you are looking for talent in the Retail sector, Cast UK are a specialist consultancy in Buying & Merchandising and Supply Chain recruiting interim, contract and permanent professional level positions.
Get in touch for an informal chat about your hiring requirements on 0161 825 0825.