Skip to content

Brexit and the creative industries: What does triggering Article 50 mean for access to talent in the UK?

Throughout EU referendum campaigning, many argued that untamed migration was the main driver of public Euroscepticism, and it ultimately dictated the UK’s decision to leave the European Union. Now Article 50 has been triggered, this article reassesses the state of migration in the UK, and poses some of the big questions that will underpin discussions around access to talent for the creative industries.

One of the core pillars of the Industrial Strategy is skills. This is recognition that government views skills development as fundamental to growth, alongside levers such as infrastructure, investment and trade. This is all the more important for the creative industries - but currently the sector cannot meet the whole of its talent needs from the UK, so firms must recruit from overseas.

The creative industries are reliant on talent from outside the UK

From our analysis of the Annual Population Survey in Skilled Migration and the UK’s Creative Industries, we see sub-sectors like ‘IT, software and computer services’ are particularly reliant on non-European nationals, at 8.4 per cent of the workforce. This compares with 4.2 per cent of the workforce as a whole.

The decision to leave the EU has tipped the UK into a state of talent uncertainty. Left unresolved, this uncertainty could be damaging for businesses who may be minded to hold off on making critical skills investment or recruitment decisions. This would, in turn, have implications for employment and growth.

We know that a large proportion of creative businesses are small or micro, and many other workers are self employed. If, say, a business has less than 10 employees on its books, the impact of a decision to employ a non-UK national is magnified. Get it wrong, and the relative cost to the business could be crippling. So, this begs the difficult question- does the business hire a UK national without all the skills required to do the job, leaving a skills gap to be filled by costly training? Or, does it persist with a skills shortage and allow this to impact business growth?

Investment in skills development vs. ‘oven-ready’ workers?

Of course, government would argue that businesses should be investing in the skills development of their employees, and it’s made steps in the right direction to supporting this. In the Spring Budget a few weeks ago, the government committed to spending up to £40 million on lifelong learning pilots by 2018-19 to test different approaches to help people to retrain and upskill throughout their working lives. But in reality, many small businesses require ‘oven-ready’ workers to add value from their first day on the job. This need for experienced, skilled workers points to a continued reliance on non-UK talent where skills shortages exist.

How do we know where skills shortages exist?

There is little granular evidence on the skills required for jobs in the creative industries. Moreover, the creative industries encompasses an enormous range of both creative and non-creative occupations, from performing artists and software developers to technicians and skilled support workers.    

Official data from surveys like the UK Commission for Employment and Skills’ (UKCES) Employer Skills Survey, despite being economy wide, and comprehensive, does not enable granular analysis of creative sub-sectors like video games or visual effects (VFX). Qualitatively, we know that a high proportion of jobs in these sectors are filled by non-UK workers owing to shortages in UK skills.

We can get to grips with changing employer demand for skills using innovative sources of data, like online job advertisements. But understanding supply is far more difficult, and is currently best gauged by asking employers and employees what skills they have as organisations and individuals.

Better evidence will be essential for meeting sector specific skills needs

Immigration Minister Robert Goodwill MP has suggested that migrants from the EU could face different rules according to which sector of the economy they chose to work in. Goodwill recently said the UK would need a “bespoke” immigration system after leaving the European Union. But at the same time, ruled out allowing UK regions to adopt their own immigration systems - something Boris Johnson MP floated whilst London mayor.

Sector specific migration policy will require the type of evidence we are currently lacking for the creative industries. There’s an imperative to understand the skills dynamics of the sector to ensure that negotiation of a sector deal incorporates its exceptional talent requirements.

4 principles for developing data-driven skills policy that works for the creative industries

In moving forward with discussions over coming months and years, industry and government should consider the following four principles in negotiating access to non-UK talent for the creative industries:

  1. Be data driven

Industry should use data to identify where there are mismatches between skills supply and demand. This will include systematically recording skills dynamics in the creative industries, using existing data such as the Annual Population Survey and Employer Skills Survey alongside web data, like online job advertisements, and industry survey data. It is important to acknowledge where there are differences in skill need across creative sectors, and the shared characteristics of skills shortages across the sub-sectors to inform development of mechanisms like the Migration Advisory Committee’s Tier 2 Shortage Occupation List. Policymakers should bear in mind that official, web-based, and industry survey data sources have limitations, and should therefore be used in ways that complement one another - providing layers of the same picture, when it comes to understanding the complex skills dynamics of the sector. Additionally, industry stakeholders should be aware of the needs of government, and a constructive dialogue, such as that fostered by the Creative Industries Council and the Creative Industries Federation, around the data needs for migration policy making should therefore continue.

  1. Be dynamic

Online job adverts can provide a highly granular picture of skill demands for individual sectors. They can be collected more frequently, and there is more of it than other mechanisms, like surveys. Job adverts allow employers to describe skill needs in their own terms - a bottom-up approach. In contrast most surveys take a top-down approach, by asking employers to select skills from a short and pre-determined list of terms. These traits enable a dynamic mechanism to understand skills - but this doesn't mean that policymakers can, or even should, respond in an equally dynamic way in making changes to systems that control supply of skills, like education and training, or migration policy. Nesta's Arloesiadur, an innovation analytics project with support from Welsh Government, is giving us new, striking and useful insights about innovation, but also teaching us something about how innovation policy needs to change in order to adapt to the big data era, and about the tools we can use to accomplish this. Ensuring that policymakers have both relevant, data driven insight, and the mechanisms to effectively use these insights is core to the skills domain.

  1. Incorporate ways of working as well as skills

As discussed, working patterns in the creative industries look different to other parts of the economy. The large proportions of self employed and micro businesses means that some conventional, and even more innovative forms of web based data will not accurately capture skills needs, or highlight where there are skills shortages. The size of businesses in the creative industries will also have implications for their ability to use sponsored migration mechanisms like Tier 2 (skilled work) owing to the financial, legal and administrative costs associated with hiring a non-EEA worker.

  1. Plan for the future

Our research, Employment in 2030, with Pearson and Oxford University, highlights the importance of looking to the future when it comes to understanding the skills needs of the economy. We are asking what skills and competencies will be required for the types of jobs that the US and UK economies will need in 2030. It is important to consider the role of both UK and non-UK talent when focusing on the supply of labour for the future. We want to understand where the main skills shortages and gaps will be and what educators and policymakers do to anticipate them. This will, of course, inform the course that government takes through Industrial Strategy, which in turn will be impacted by Brexit. Predicting future jobs and skills demand over a 15-year horizon is a daunting task, but planning for the future is fundamental to ensuring that the UK has the talent it needs to enable continued growth of important sectors like the creative industries, both home-grown talent and migrant labour.

Image credit: dannyman on flickr, CC by 2.0 

 

Author

George Windsor

George Windsor

George Windsor

Senior Policy Researcher

George was a Senior Policy Researcher in the Creative and Digital Economy team.

View profile