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16 April 2019

Tight labour market another headache for small business owners as EU staff wrestle with settled status applications

The UK’s unemployment rate remains at a near record-low 3.9% according to new Office for National Statistics (ONS) analysis published today.    

Net EU migration to the UK fell to the lowest level since 2009 last year. The latest Small Business Index (SBI) shows that one in three (32%) smaller firms identify access to the right staff as a major barrier to growth.

Federation of Small Businesses (FSB) National Chairman Mike Cherry said: “At a time when political uncertainty is making it impossible to plan and operating costs are spiralling, a tight labour market represents yet another headache for small business owners.  

“One in five small UK employers rely on staff from the EU. The sharp drop in European arrivals is a real concern for many smaller firms, particularly those in sectors such as construction, care and engineering where the contribution of EU team members is so vital. One in three small firms now say lack of access to the right personnel is a major barrier to growth.  

“To make matters worse, EU staff are up against a settled status programme beset by glitches, data breaches and poor accessibility on phones. Whilst we welcome the roll-out of a scheme that gives EU citizens based in the UK some certainty, reports of practice on the ground have been disappointing. We were told that the process for securing settled status would be straightforward and swift. It’s proving to be anything but.

“The case for the Government to deliver on its pledge of a one-year national insurance holiday for those furthest from the labour market has never been stronger. With skills shortages starting to bite, it’s vital that we are helped to bring more people who are living with a disability, long-term unemployed or ex-offenders into our workforces.”