Could Brexit Impair HR in the UK’s Automotive Industry?

Could Brexit Impair HR in the UK’s Automotive Industry?

The number of people dependent on the automotive sector for employment increased by 17,000 to 814,000 in 2015.  169,000 of these employees worked in vehicle manufacturing (1). Turning over £71.6bn and contributing £15.5bn to the UK economy, the car industry is clearly important for UK GDP.  How will the Brexit vote affect this?

Alan Locke, of Manchester-based AYCEN Group, comments, “Wide-ranging automotive organisations have been quick to voice their concerns over how the industry’s workforce could be affected as a result of the UK leaving the EU.”

“It must be remembered, though, that it will take around two years after Article 50 is triggered until the UK actually formally detaches from the EU.  It’s hoped that it will be ‘business as usual’ until such a time”, Alan adds.

Mike Hawes, Chief Executive of the Society of Motor Manufacturers and Traders’ (SMMT) stated unambiguously within 24 hours of the Leave result: “The government must now secure a deal with the EU which safeguards UK automotive interests. This includes ensuring we can recruit talent from the EU” (2).

“One of the factors Mr Hawes links the recent buoyancy of the UK’s car industry to is ‘unrestricted access to the single market, input to EU legislation to safeguard the interests of UK Automotive, and the ability to recruit talent from abroad‘”, comments Alan

At Vauxhall’s Luton plant, the UK car manufacturer actively supplements its staff with employees from its Polish sites.  Approximately 10% of UK managers employed by the BMW Group are assigned to work at its various European locations at any one time. In recent times, the Group’s MINI division saw approximately 150 European employees seconded to work at its Oxford plant during the production of a new model.


How Will Brexit Impact the EU Talent Pool?

In April 2014, KPMG published a report (3) entitled ‘The UK Automotive Industry and the EU‘, in which it found there to be “a shortage of qualified scientists, engineers and technologists (SET)” in the UK automotive sector.

Pointing to data from UKCES that identifies 20% of vacant automotive SET roles as being hard-to-fill, KPMG states that “having an EU-wide talent pool is important in filling these business-critical vacancies.”

“Highly skilled Eastern European, German, French and other workers currently employed in UK automotive roles ranging from mechanical engineers and plant managers to R&D and administration could ultimately be lost once the UK formally leaves the EU,” suggests Alan.

Another possibility identified by KPMG’s report is that automotive firms with sites in the UK, such as Nissan, Honda and Toyota, may find that their people can no longer travel overseas at short notice – something their EU staff is currently able to do.

“It is clear that this thriving sector will face HR challenges along the way,” concludes Alan.  “But with the right leadership and lobbying, it’s hoped that access to the common market along with its talented workforce will be retained.”