New immigration policy slammed by freight industry groups

Freight and logistics groups slam new immigration policy

Freight and logistics industry groups have urged the Government to reconsider its new points-based immigration system which will limit the number of low-skilled workers entering the UK. 

Home Secretary Priti Patel announced the new system earlier this week which will take effect from 1 January 2021.

Under the revised system, points will be assigned for specific skills, qualifications, salaries or professions with the points’ threshold “carefully set to attract the talent that the UK needs”. 

Anyone who meets the required number of points will be eligible to apply for a UK visa.

The Freight Transport Association (FTA) said vital logistics workers must be excluded from the “restrictive” policy. FTA said the government must realise how reliant the industry is on EU workers, and that the sector is already suffering from a severe labour shortage. 

According to FTA’s Logistics Skills Report 2019, declining EU net migration has contributed to a 43% rise in job vacancies in the transport and storage industry over the past couple of years.

Sally Gilson, Head of Skills Policy at FTA, commented: “As the only business group representing all of the logistics industry, FTA needs the Prime Minister, Boris Johnson, to reconsider his post-Brexit immigration policy immediately; the UK economy simply cannot operate without the logistics workforce.

“The sector is already facing a severe labour shortage – 64% of transport and storage businesses are now struggling to fill vacancies – and with EU workers currently constituting 13% of the entire logistics workforce, it is obvious how detrimental this policy will be on the very businesses charged with keeping the UK trading. If the government insists on withdrawing access to EU workers, it will have to adapt and adjust its allowances for training; the burden should not solely lie on UK businesses.

“FTA is also appalled that the government has deemed HGV driving – along with many other logistics occupations – to be ‘low skilled’ activities; these are, in fact, very challenging roles. Vocational occupations make a significant contribution to the UK economy; FTA is urging the government to realise it is not just academically trained workers that hold value.”

Ms Gilson continued: “The logistics sector is the lifeblood of the nation’s economy, ensuring shops, hospitals, restaurants and schools etc. all receive the goods they need to operate. FTA is urging the Government to give special dispensation to EU logistics workers; they must be welcomed post-Brexit transition period to ensure the sector can continue operating. While businesses within the logistics sector will do everything possible to keep the UK trading, without adequate levels of staff, operations will become strained and UK plc will inevitably suffer.”

The Road Haulage Association said more detail is needed on the Government’s points system for immigrants and the criteria for establishing the basis of ‘skilled’ work.

The Association said it is extremely concerned that the ability to drive a heavy goods vehicle is not considered to be a skill. “Nothing could be further from the truth,” said RHA Chief Executive, Richard Burnett.

RHA said the average age of an HGV driver is 55, less than one percent are aged under 25 and the cost of training is approximately £5,000.

“Profit margins are so low, between one and two per cent, that employers simply cannot afford to train new drivers,” he continued. “They need to employ those that are already qualified but with a 60,000 shortfall this is impossible.

“Since its inception in 2017, hauliers have invested £320 million into the Apprenticeship Levy yet only £20 million has been withdrawn. It’s just not working. It’s a tax on our industry.

“For years we have been talking to the Home Office about getting the HGV driver skills shortage added to the UK Shortage Occupation list that includes all of the occupations that currently have a skills deficit.

“With a shortfall of approximately 60,000 drivers, we are of the firm opinion that this industry should certainly be near, if not top of the list.

“It’s a triple whammy,” Richard Burnett continued.  “We’re not getting the money to train new drivers, the driver shortage isn’t recognised and now we’re being told that operators can’t employ immigrants to fill staff rotas.

“Many UK operators are totally reliant on European drivers. Putting a stop to the immigrant workforce will have a massive impact on the supply chain, and the next-day deliveries we have all come to expect will be a thing of the past.

“There is a clear lack of communication between Government departments i.e. the Home Office and the Department for Education. The left hand doesn’t know what the right hand is doing and urgent reform is desperately needed for the Apprenticeship Levy. Otherwise all pipelines for recruitment will dry up.

“Ninety-five percent of all goods in the UK have made the journey to their ultimate destination on the back of a truck and the UK economy is totally reliant on an efficient supply chain network. It cannot be allowed to grind to a halt as a result of government short-sightedness.”

The UK Warehousing Association (UKWA) has warned that the logistics industry is likely to face a shortage of vital workers following the Government’s announcement.

Peter Ward, the Association’s CEO, commented: “‘Companies operating in the logistics and warehousing industry need access to low-skilled, low-cost labour and with low youth unemployment figures in the UK, the sector has traditionally looked to the EU to supplement its workforce."

He continued: “While it is hoped that the majority of EU citizens currently working in UK warehouses and distribution centres will choose to stay in Britain by applying for EU settlement scheme status, it is clear that the inability to recruit shop-floor operations staff from other countries will add to the recruitment pressure that the logistics industry is already under.”

Peter Ward questioned the Government’s suggestion that businesses will be able to reduce their reliance on foreign workers by increasing levels of pay and investing in automation.

He said: “The logistics industry operates on the narrowest of margins and it is hard to see how any significant across-the-board pay increases for low-skilled staff could be introduced without passing on the additional costs, unless the days when online shoppers expect low priced goods with cost-free and immediate delivery become a thing of the past.

“And, while it is true that the use of automation is growing across the logistics industry, there are many roles within a typical warehouse operation that remain difficult to automate. Although recent developments have made automation more scalable and flexible, for many warehouse operators the outlay on the type of fixed assets found in automated systems – is impossible to justify. Furthermore, automation does not replace a workforce, but creates new jobs with different skills, which needs investment in training and cannot be achieved overnight."

Peter Ward added: “UKWA remains committed to working with the Government to find practical solutions to the issues that lie ahead, and we are seeking urgent talks to deliver the message that the logistics industry must have access to the workers needed to ensure that the UK’s essential supply chains do not suffer as a result of these changes to our immigration rules.”