The agricultural industry is extremely important to the UK economy. The sector is becoming increasingly reliant on supply from European countries. The UK's exit from the EU will create impediments to acquiring this labor (Simionescu et al. 2017, p.757). Agriculture and horticulture will be substantially impacted, and recovery will be challenging. There will be no flow of labor after the UK leaves the EU. As a result, the availability of British items will be limited. Due to the competitiveness of the agricultural sector, it will be hard to maintain the supplies, and it will have a negative impact on the economy, which is shown in the table below.
Year
Number of EU-born employed
2015
22517
2014
22371
2013
18784
2012
19138
2011
15957
Table 1: Number of Employees from EU Employed in the UK Agriculture Sector
It contributes to up to 20% of the total employees, and it is a very significant number. After UK exits the EU, there will be no free movement within the countries. The restriction will cause a lot of trouble, especially in the export part (Burrell 2016, p.140). Once that bond between the countries is broken, it will be difficult to export their products. The UK will experience tariffs and will not have any favours. The taxes will lead to a high export cost which will lead to economic downfall. There will be a considerable decrease in the demand for labour. Immigrants in a country increase the demand for labour, which, in turn, leads to increase in wages and employment. They also increase the demand for goods and services (Zaiceva and Zimmermann 2016, p.402). Another aspect is a rise in investments. These effects will lead to high demand for labour, and therefore, a steep increase in employment and wages (Docquier et al. 2014, p.1124). The UK will not benefit significantly from this since the lesser the number of EU migrants in the country, the lower the demand for goods and services and therefore the smaller the demand for labour.
Short-Term Effects of Brexit
After Brexit, some of the UK employees will lose their job. The companies with business in the EU and offices in England will trim staff and move to continental-bases operations (Galgoczi, Leschker, and Watt 2013, p.40). The number of employees that will lose their jobs will not be so high and can, therefore, be overcome (Dustman et al. 2013, p. 145).
Most of the immigrants from the EU countries have a lot of talents. Therefore, there will be a shortage of employees with high skills. Sectors such as construction which highly relies on the qualified EU workers will be profoundly affected (Vargas-Silva 2016, p.461). Students in most universities will suffer extensively, with fears of losing the important learning key staff members. Reduction of these skilled workers from the country will change the technology growth in the nation (Humphries et al. 2015, p.35). The qualified employees encourage innovation and adoption of the more intensive technologies which will enhance the quality of products in the country (Dustman et al. 2013, p. 145). The Table 1 below clearly shows that EU immigrants are not only educated but also more likely to work than the UK-born.
Age finished education
UK-Born
EU immigrants
High(21 or older)
23%
43%
Medium (17-20)
33%
42%
Low ( 16 and below)
44%
15%
All
100%
Table 1: The Difference in Level of Education between the EU Immigrants and the UK-Born Workers (Source: Dustmann, Glitz, and Frattini n.d.)
After Brexit, the county will suffer a loss of skilled personnel; it can be, however, overcome, since there are still qualified individual in the UK. In case the immigrants leave the country, there will be a considerable decline in the demand for labour. A study was done to identify the percentage of EU immigrants who were in the working bracket, and the results are as follows.
UK-BORN
EU IMMIGRANTS
EMPLOYED
72.5%
78.2%
UNEMPLOYED
3.3%
3.2%
STUDENTS
7.7%
7.1%
INACTIVE
16.5%
11.6%
Table 2: Employment Levels of UK-Born Citizens and Immigrants (Dustmann, Frattini, and Preston 2013, p.147)
The UK will not enjoy the great mix of products from the EU states. The immigrants from other countries bring with them skills to manufacture a variety of goods (Manacorda, Manning, and Wadsworth 2012, p. 137). The qualified foreign workers, for example, have an extensive knowledge of the latest technologies. With their talents, they help the country in the provision of better products and also new types of commodities. In this way, they increase the number of market products (Dustmann, Frattini, and Rosso 2005, p.539). The growth of the low-skilled workers may also expand the provision of other goods and services that use such labour intensively (Triandafyllidou and Gropas 2014, p.33). Therefore, the decline of the high- and low-skilled employees will lead to decrease in production in the country.
Highly-skilled immigrants bring about competition. It is a high motivation factor for hard work and desire to perform better (Galgoczi et al. 2013, p.46). Thus, without the immigrants, the UK born workers will not be driven to increase the quality of the products and services they offer. The incomers create fear in the local employees, which will make them work harder to retain their current positions. They will be forced to look for techniques to fight the high competition, and it will, in turn, lead to better products and services offered (Elsner 2013, p.157). If the immigrants return to their homes, it will lead to a stagnant provision of the same old goods. There will be no increase in quality of products and services offered, since there is no competition.
References
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Docquier, F., Ozden, Ç. and Peri, G., 2014. The labour market effects of immigration and emigration in OECD countries. The Economic Journal, vol. 124, no. 579, pp.1106-1145.
Dustmann, C., Frattini, T. and Preston, I.P., 2013. The effect of immigration along the distribution of wages. Review of Economic Studies, vol. 80, no. 1, pp. 145-173.
Dustmann, C., Frattini, T. and Rosso, A., 2005. The effect of emigration from Poland on Polish wages. The Scandinavian Journal of Economics, vol. 117, no. 2, pp.522-564.
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Simionescu, M., Bilan, Y. and Mentel, G., 2017. Economic effects of migration from Poland to the UK. The Amfiteatru Economic Journal, vol. 19, no. 46, pp.757-770.
Triandafyllidou, A. and Gropas, R., 2014. European immigration: A sourcebook, 2nd edition. Abingdon: Routledge.
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Zaiceva, A. and Zimmermann, K.F., 2016. Returning home at times of trouble? Return migration of EU enlargement migrants during the crisis. In M. Kahanec and K.F. Zimmermann, eds., Labour Migration, EU Enlargement, and the Vast Recession (pp. 397-418). Berlin: Springer Berlin Heidelberg.
