Are UK IT contractors leaving the sinking Brexit ship?
Human Resources

Are UK IT contractors leaving the sinking Brexit ship?

Ever since the UK shocked the world (and, maybe, itself) by voting to exit the European Union, pundits have prognosticated on what effects this will have on the economy and society. While many think it’s too early to say, UK skills sourcing company Arrows Group broke cover and came out with a notable statement, suggesting that Brexit is already leading to a 10 per cent reduction in skilled tech workers from within the EU relocating to the UK. Conversely, the company says there is an increase in UK digital skills heading elsewhere, notably Switzerland.

The Arrows database used for this research only covers about 2,000 contractors but as an early indicator of what is going on its insights might have some value. With that caveat, I followed up with Arrows founder and CEO James Parsons and the following is a lightly edited version of our email exchange.

 

Q. How confident are you that these numbers are caused by Brexit? Did you ask questions directly about reasons for movements?

A. Very confident. London, as one of Europe’s leading technology hubs, is a great place to work with huge opportunity. With this comes a significant amount of skills migration from Europe to London, but this has come off the boil in the last year, and we’re confident it is down to the recent phenomenon of our decision to leave the EU. The opportunities are still there, but the confidence to come to the UK and reap these prospects isn’t.

 

What is the outlook? Do you expect this trend to continue?

Short-term, yes. Once Article 50 is triggered, the UK digital skills gap will need to be addressed. Medium-term, there will be more certainty. What’s more, the UK has to compete with central Europe countries like Switzerland who are benefiting from this uncertainty and seeing an increase in best-in-class developers taking roles. It’s a case of short-term uncertainty which we hope will lead the way for longer-term clarity.

 

If so, how damaging is it to your company?

It’s not damaging as we have a global client base and a blended onshore and offshore sourcing model. It does, however, pose an extra challenge, which is why we’re encouraging UK businesses to expand their global footprint and operations to where the talent is located, as well as be proactive in expanding their pipeline of home-grown UK digital talent.

 

What sorts of laws and incentives to attract and retain talent would you like to see?

Primarily, UK businesses need to create a company culture that attracts and retains digital talent. I would like to see skills mobility made easier, which means no border restrictions and a limit to visa requirements. Secondly, the government is continually looking to remove the competitive advantages of being a contractor, most recently seen by the Chancellor’s abandoned National Insurance hike. The best [skilled people], however, need to work in a flexible manner, so we must ensure that the UK remains a competitive place for contractors to operate in. It’s about protecting and encouraging freelancers to work in the UK tech space.

 

Postscript: I ran the notion of Brexit inspiring a weakening of the UK’s appeal to tech workers by several recruiters. Among the first to reply was Xref CEO Lee-Martin Seymour who said:

“We don’t yet know what the triggering of Article 50 will mean for the UK but any new relationship between the UK and Europe, is likely to involve a crackdown on the free flow of EU labour into the UK and vice-versa. We‘ve not yet begun to see this prophecy affecting recruiting. 

“What we also expect to see as Britain begins the process of establishing a new accord with the EU, is a tide of exiting workers: people returning to the EU from the UK.”

 

Also read:
Europe could be tech investment playground for Asia
Snap shows London remains a magnet for tech firms, despite Brexit
Brexit vote is a blow to UK tech brains
IDG Connect Brexit roundup

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Martin Veitch

Martin Veitch is Editorial Consultant for IDG Connect

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Comments

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Alex on April 14 2017

Perhaps rates will become more realistic here. I'm on the same rate I was 15 years ago whilst house prices have doubled and I'm on the high end of the scale; freedom of movement has only been good for the corporate entities and bad for everyone else.

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Alex on April 14 2017

Perhaps rates will become more realistic here. I'm on the same rate I was 15 years ago whilst house prices have doubled and I'm on the high end of the scale; freedom of movement has only been good for the corporate entities and bad for everyone else.

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