Negative Impact of Brexit: Critical Analysis

The United Kingdom (UK) is one of the biggest countries in the World economy it provides sources to worldwide organizations to fulfil their needs. Most of the biggest Multinational Corporation are Situated in the UK. Tesco, Sainsbury, Cadbury, Nestle, the success of UK organizations depended on their labour skills. They contribute a major part in the UK economy. But due to the decision of leaving the European Union, it will negatively impact on the labour market of England. Business organizations suffer from, skills shortage, the slowdown of growth, lack of resource, heavy trait duty. This report has been included a summary regarding impact of BREXIT agreement on the Labour Market of UK perception of labours effect on their life. It also provides data related to the Gross Domestic Product (GDP) rate of UK after the agreement.

Affirmation of the problem

The main objective of this report is to provide information regarding the negative impact of BREXIT, of GDP growth in the UK, and the consequences in the foreign workforce in the hospitality sector.

Research Hypothesis

There are several primary categories that can benefit from this study, one of which is employees of UK business organizations who are mostly migrants, so through this study, they can learn how to overcome this period and how to manage their work, their benefits, as well as the negative impact on their morale after the United Kingdom leaves the European Union.

Another primary category belongs to employers, who from my point of view are the most affected, because most of the employees in the UK are citizens of the European Union.

Scope of the Study

This project aims to provide an understanding of the consequences the Brexit has on Labour Market. In addition, there will be given several recommendations to improve this sector and to overcome Brexit matter.

The sets will be taken from the overview of the current tourism relationship between the UK and the European Union, research statistics on, UK visit for holidays and for the purpose of employability by citizens of other countries, statistics from (June 23, 2016) the period time when referendum it was started, and statistics from the period (2018/2019), so far.

Literature Review

According to S. Nickel decision taken by the UK government regarding BREXIT agreement, was may impact for the long-term time, but recently it will be adversely. Affect the overall England Labour Market. As due to their decision many EU or based organization change their pace of working and strop providing facilities to labours of UK which engaged in work for their organization, shortage of labour, unemployment, rate of wages decreases in living standards decline in growth all the problems have been suffering by the United Kingdom still they have hope that their decision will help in the future growth of the country as well as labour market of England.

According to Jonathan Boys, economist Labour Market, from the perspective of commentators to expect a high level of employment was a success in the Labour Market that defied expectations. The question of many people, how employment was so high despite the uncertainty of BREXIT, an obvious answer is that the European Union has not yet left. Conforming uncertainty his, Gertjan Vlieghe from the Bank of England, the possibility that companies do not want to spend money on expensive investments such as specialized equipment because this is difficult to reverse. Limiting public sector wages is eased and this is evident in unemployment data, which makes public sector employees more likely to increase starting salaries in response to recruitment difficulties and salaries, more precisely to retention difficulties. (Boys, 2019).

Alex Fleming President of Personnel and Solution, Adecco Group in the UK and Ireland, points out that the clarity of a confirmed date for BREXIT, according to data collected at the edit Labour Market Outlook report, where it shows that employee confidence for Q4 has increased since +18 to +22, Constructions with (+38), Administrative activities as well as other services with (+30), and Medical assistance with (+30), thus holding the highest level of trust. OMO’s measure as work confidence score thus varying +15 and +22 since the referendum in June 2016 and thus remaining at the highest post-referendum level. Along with the deadline for BREXIT, postponed from that period, thus expecting a fluctuation compared to the first quarter of 2020 of the LMO, but 86% of companies plan their payment reviews in the next 12 months, the uncertainty regarding future access to the EU market, thus influencing 22% of companies’ decisions below 2%. According to research, 27% of employers are convinced that they have enough information to consider post-Brexit recruitment decisions, but they can still act immediately for better retention. (Fleming, 2019)

Methodology

The methodology is a framework used by researchers to find out the way investigators collected data for their research project. In this report, secondary data has been used for the collection of essential information regarding the impact of BREXIT garment on the labour market of the UK (Coulter and Hancke, 2016).

Data analysis technique has been utilized for the collection of essential data. By this method of research methodology, the investigator will be able to identify the impact of the agreement on labour sector. Various papers, research report reinvestigate to find reliable and accurate data (Strielkowski, Tumanyan and Kalyugina, S).

Results/ Discussion

It appears that this research it was constituted in finding out the importance of the impact on the Labour Market, on the problems faced by the decreases in employment rate, however, the rate will grow considerably in the future because in the UK are many European citizens with the right of work, many students with skills and experience in different areas. The hotel industry is suffering from a mitigation problem.

The government is deciding on providing flexible faculties and policies for EU citizens workers to come and go freely to their country, to remove any trade restrictions and barriers. Even the UK growth rate is declining, but it will increase in the future.

Section II

Findings, Case study, Conclusions, and Recommendations

Introduction

This study was created to determine the impact of BREXIT on the UK labour market and hospitality sector, migrants and concerning the Gross Domestic Product (GDP).

Findings

The results will be presented in three sections according to the following characteristics.

Figure 1 – Change in UK employment by nationality, period (1997 to 2018).

Figure 2- Estimated workforce jobs by the UK, seasonally adjusted (December 2018 and December 2019).

Table 1 – (95% confidence intervals), estimation of the UK and non-UK employment from Labour Force Survey, October to December 2019.

From the period 1997, the number of EU citizens, working in the UK has risen from 437,000 to a peak of 2,378,000 in July to September last year, a considerable increase, so the number of non-UE citizens has grown rapidly in 1990. , as well as at the beginning of 2000, thus growing around 1.2 million in the last 10 years. (Hillage, 2018).

Figure 1

Estimation Workforce

Employment increased in 6 of the 12 regions of Great Britain, between September 2019 and December 2019, thus estimating an increase of 43,000 in London, followed by 42,000 in the South-East. A considerable decrease occurred in the North-West, at 53,000 followed by the country of Gaul with 27,000.

As shown (Figure 2) London had the largest increase in employment in (December 2018) an estimate of 170,000 compared to the previous year, a single decrease was around 4,000 occurring in Wales. (Watson, 2020)

Figure 2

The sample contains variable estimates for 95% confidence intervals, thus being considered in data that are not seasonally adjusted. (Clegg, 2019)

Employment (thousands 34,697 of people age 16 years and over).

Employment rate (%, 76,1% aged 16 to 64 years).

Unemployment 1,998 (thousands of people

Age 16 years and oner Unemployment rate (% 3,8% aged 16 and over

Economically inactive 8,900 (thousands of people aged 16 to 64 years

Economic inactivity rate 23,8% (%aged 16 to 64 years)

Table 01

Estimate (seasonally adjusted )

Sampling variability of of estimate (1)

±187

±0,4 ±68

±154 ±175

±0,4

Change on quarter

99

0,2 -76

-23 -23

-0,1

Sampling variability of change on quarter (1)

±138

±0,3 ±75

±0,3 ±135

±0,3

Change on years

354

0,5 -119

-69 -69

-0,2

Sampling variability of change on year (1) ±234

±0,5 ±90

±204 ±255

±0,5

Case Study

The United Kingdom takes the decision to leave the European Union in (June 23 /2016), by a referendum, which is acumination of European courtiers which decided to ace a formulate adopt similar trade, politics, travelling policies. Government of the UK take a decision for improving future growth rate of the UK by increasing profitability rate in the furious, hospitality sector. They take this decision to overcome the issue of mitigation of arbours. British labours have a low rate in the market and thus they move in European Courtiers for their employment purpose. But it will also have a negative impact that THE COUNTRY FACES FROM THE LABOUR SHORTAGE PROBLEM AS THE EU PROVIDES SKILLS ABOUT TO UK ORGANIZATION those have capabilities to solve the problem and effectively increase the performance of business organizations. The entire effect of BREXIT agreement will not only affect the migration flows but it also effects on economic factors such as business trade policies, strategies. Changes in the UK labour market (Hobolt, 2016).

Hiring challenges: Low employment, falling migration, and uncertainly related to the post BREXIT migration, this is very deficit for an organization to find skies, staff. As per the market data published in June 2019 report the labour market of the UK relatively stable.

The employee reports.

More than 4.7 million workers able to find a job and start working. At the time more than 350.000 unemployed workers included in the inactive worker’s list. The employment rest between 16 to 64 age group also decline in London, but it will be raised when analysis of the overall employment rate of the country. Rates of labour of women have been raised. Recorded more than 7% of women are hired in June quarter of 2019.The average earning of Britishers was incensing living standard rate increase. Across more than 12% of householders start working.

Just like other industrial sector hotel industry also suffers from weak money, the value of the pound. It will impact on their imported cost their quality Maintenance cost has been increased due to this agreement (Somai and Biedermann, 2016).

UK economy loss will persist in 2020.

Future trade ration with the EU which will continue to undermine confidence. UK government try to impress their foreign investors by investment in the travelling industry it will help in booming the hotel industry profit. Though hotel industry suffers from the employment problem it also has positivity impact as they are able to hire local personal it will help in reducing the unemployment rate, as wheel as it is also useful for increasing the GDP rate of the UK. As per the survey supply of equipment, the material requires for hotel industries to provide their customers full faculties is become highly cost. The industry suffers from loses as due to weakness of British currency in the international market.

In the United Kingdom, more than 2.9 million engaged with hospitalities sectors. In which more than 500.000 labours are engaged with the hotel industry. The industry is effect form this agreement due to most of the housekeepers, waiters, and chefs come from EU nation (Gamble, 2018). According to the server, more than 64% of workers are based on non-UK. Foreign direct investment: It contributes directly to UK income. FDI help in providing funds for the expansion of the country business. Leaving the EU UK needs to increase their supply chain in other coterie imparked relationship with them so they help UK to solve problems and also provides fancily help and give the opportunity to UK FIRMS TO INVEST IN THEIR COUNTRIES with a low rate of tax (Ford, 2016).

Conclusion

From the above analysis, it has been identified that decision taken by the British government regarding exit from European Union will impact positively and provides opportunities help in the growing British economy, but at present time the country suffers from many issue especially labour sector of the hospitality industry. The sector helps in providing 6 % of GDP contribution to the country but du to this agreement hey faces mitigation, labours problems and revenue goes down of the industry on the other side many labours get unemployed due to this decision, the government had formulated policies to flexible rules for these sectors through which they able to overcome problems and increase their rate of profit.

Recommendation

• Government need to formulate flexible policies regarding the issue of mitigation of workers.
• British governed need to prove financial Assisi peace to hospitality sectors. 10
• Build welfare schemas for labours.
• Provides minimum wages rate to each category of labours.
• Improvement of relation with foreign courtiers.
• Established new emplacement opportunities for their unemployed workers.

References

1. Courtice, J., 2016. Brexit: Behind the referendum. Political Insight, 7(2), pp.4-7.
2. Ford, M., 2016. The Impact of Brexit on UK Labour Law. Int’l J. Comp. Lab. L. & Indus. Rel., 32, p.473.
3. Coulter, S. and Hancke, B., 2016. A bonfire of the regulations, or business as usual? The UK labour market and the political economy of Brexit. The Political Quarterly, 87(2), pp.148-156.
4. Gamble, A., 2018. Taking back control: the political implications of Brexit. Journal of European public policy, 25(8), pp.1215-1232.
5. Hublot, S. B., 2016. The Brexit vote: a divided nation, a divided continent. Journal of European Public Policy, 23(9), pp.1259-1277.
6. Strielkowski, W., Tumanyan, Y. and Kalyugina, S., 2016. Labour market inclusion of international protection applicants and beneficiaries. Economics & Sociology, 9(2), p.293.
7. Simionescu, M., 2018. The impact of Brexit on the UK inwards FDI. Economics, Management and Sustainability, 3(1), pp.6-20.
8. Somali, M. and Biederman, Z., 2016. Brexit: Reasons and challenges. Acta Economical, 66(s1), pp.137-156.

References Websites

1. Boys, J., 2019. Labour Market Outlook. [Online] Available at: https://www.cipd.co.uk/ [Accessed 01 May 2020].
2. Clegg, R., 2019. Labour market overview, UK: May 2019. [Online] Available at: https://www.ons.gov.uk/ [Accessed 01 May 2020].
3. Fleming, A., 2019. Labour Market Outlook. [Online] Available at: https://www.cipd.co.uk/ [Accessed 02 May 2020].
4. Hillage, J., 2018. Further decline in EU workers prompts fears of labour shortages. [Online] Available at: https://www.employment-studies.co.uk/ [Accessed 29 April 2020].
5. Watson, B., 2020. Labour market in the regions of the UK: April 2020. [Online] Available at: https://www.ons.gov.uk/ [Accessed 18 april 2020].