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What can employers take from the latest migration statistics?

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In August we blogged on the CIPD’s latest quarterly labour market snapshot which found that the number of applicants per vacancy had significantly decreased across all skill levels in the last 12 months.

The ONS has now released its August quarterly report on the UK migration statistics for the year ending March 2018 and the report highlights some interesting shifts in the patterns of EU migration in and out of the UK.

Long-term net migration continues to add to the UK population, with 270,000 more people coming to the UK than leaving. This is less than peak migration levels in 2015 and 2016 and has remained broadly stable since.

EU net migration is at its lowest level since 2012 but continues to add to the UK population, with around 90,000 more EU citizens coming to the UK than leaving in the year ending March 2018. EU net migration peaked in the year to June 2016, with 189,000 more EU migrants coming to the UK than leaving.

Since 2016, much of the decrease in EU net migration can be attributed to lower net migration from EU8 countries (Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland and Slovakia). There are many factors that contribute to this, including the weaker pound and uncertainty surrounding Brexit.

This is in stark contrast to migration from EU2 countries (Romania and Bulgaria) which has now been greater than that of the EU8 countries over the same period.

In some ways the demographic shift in EU migration away from EU8 countries and towards EU2 countries is to be expected. The EU8 countries have been members of the EU for close to 15 years now, during which time their economies have seen the benefits of EU membership. With stronger economies come more jobs, higher wages and a stronger currency – all of which mean there is less motivation to come to the UK to work, and more reason to return home. The same may be true of EU2 countries in the future.

Unfortunately the ONS report does not go into detail regarding the types of people leaving versus those arriving. It would be interesting to see whether it is the longer-term EU migrants, who are more likely to have comparable employment experience and speak English to a high standard, who are leaving only to be replaced by EU migrants with less experience. This would go some way to explaining the continued shortage of applicants per vacancy.

Employers should take note of the decrease in the rate of migration from the EU and the significant decrease in applications per job vacancy across all skill levels. In response, employers may wish to enter into a dialogue with their EU employees to ensure they can retain their best talent post-Brexit. EU nationals who leave due to uncertainty surrounding Brexit will become harder to replace in the future.