Care Home Sector Must Embrace A New Recruitment Mindset In A Post-Brexit World

By Tom Robinson, Partner, Healthcare Advisory team, Cushman & Wakefield

Since the result of the EU Referendum, advisors to the UK healthcare market have largely focused on the impact on investment in the sector. While some property funds closed the doors to redemptions days after the result, UK healthcare advisors redoubled their efforts to reassure that their asset class would be fine.

However, asset values and investment performance is only part of the picture. What about the business of healthcare?

People are at the core of the UK healthcare industry. They are its defining feature, being not only the end user, but its workforce too – the single largest input which allows the entire system to function. These two groups are both the purpose and the means for healthcare.

Brexit makes no difference to the end user; people will still need care. However, it is different for the enormous workforce. Some 1.5m people are employed by the NHS and it is one of the five largest employers on the planet. For half a century the immense staff requirements of the UK healthcare industry has been fed by both British and overseas staff, the latter being a mix of EU and non-EU nationals.

It is true that the care home market is but a slice of the wider UK healthcare system and that it differs hugely from the NHS, being mainly in the private sector, but the importance of staff is just as substantial.

The care home sector in a post-Brexit Britain will clearly be affected if we do step away from the freedom of movement. How far will it impact on operators who need nursing, care, domestic and other staff, especially those who have found their local environs unable to fill all the posts?

In an effort to get away from rhetoric, assumptions or a care sector bias, we sought the views of an expert in the form of Allan Briddock, Consultant Barrister for Blake Morgan LLP. Allan argues that, with the UK needing hundreds of thousands of workers per year, and as lower paid employment has tended to be filled by EU nationals, it is likely the rules will be relaxed to allow lower paid workers from anywhere in the world to apply to work in the UK.

He adds that there is already in place the never-introduced Tier 3 of the Points Based System which was designed for low-skilled workers. Tier 3, or something like it which lowers the earning criteria for immigrants, will likely need to be introduced if employers can no longer rely on EU workers to fill the gaps.

Allan’s thoughts raise an interesting point for care home operators. The choice to seek EU staff was a rational one, with a good level of supply, opportunity for mutually-recognised qualifications and ease of EU staff who could be employed at or around minimum wage if required. This is not to say that the only option for non-UK staff is the lower grade roles, quite the opposite in many cases, especially in nursing, but it is undeniable that non-UK staff have been pivotal in plugging the gap in this part of the staff team.

There may be uncertainty over the shape of post-Brexit immigration policy, but care home operators can be reassured that whatever the shape of policy, it is almost certain that existing EU staff will be allowed to remain. No incumbent government would oversee policy which strangles the care sector from accessing the staff it requires.

It is possible that the seemingly limiting factor of the end of freedom of movement for EU staff may be the impetus for the creation of a more-level playing field, no matter the geographical origin of the candidates, be they intra or extra EU nationals.

A Tier 3-type policy structure could be the backbone of a new playing field, allowing employers to use a global recruitment net. Regardless of the exact policy, it is clear that the care market will see yet another change to the makeup of the staff team, this time with a potential shift towards a less EU-centric makeup.

The optimist’s view is that the best-prepared operators will be those who explore the staffing opportunities which become available. Private sector social care is an entrepreneurial environment and we are already seeing people look to a global staff pool, together with the provision of accommodation and acclimatisation education. We have seen others redouble efforts to attract a local employment base where possible, with better rates of pay, innovative recruitment techniques and job perks to differentiate from their competition. The recent rumblings from Westminster about pushing the implementation of the 2020 Minimum Wage out a few years could help this cause.

Returning to my initial point about the impact in investment terms – in my view, if the business that underpins the investment manages to stay robust and innovation continues, the impact should be limited. The one proviso is that future Government policy must not completely turn off the supply of overseas staff.