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UK Businesses Criticized for Failing to Prepare for Brexit-Induced Labour Shortages

Strategic Insights

— 2 min read

British Cabinet ministers are criticizing businesses for being "drunk on cheap labour", claiming they have failed to prepare for the post-Brexit economy. The Government is insisting that industry must shoulder the responsibility for petrol and food shortages, while business leaders are accusing the Government of "starting to panic" and "getting their excuses in early". The criticism comes as warnings of Christmas shortages grow, with several members of the Cabinet understood to be furious at companies trying to shift blame on to the Government.

Key Takeaways:

  • A series of ministers criticized firms at the Conservative Party conference, with several members of the Cabinet understood to be furious at what they saw as companies trying to shift blame on to the Government.
  • Cabinet ministers believe that industry must shoulder the responsibility for petrol and food shortages, which they claim are a result of businesses being "drunk on cheap labour".
  • The criticism comes as warnings of Christmas shortages grow, with several members of the Cabinet understood to be furious at companies trying to shift blame on to the Government.
  • Business leaders are accusing the Government of "starting to panic" and "getting their excuses in early", despite the Government's insistence that industry must prepare for the post-Brexit economy.
  • Rishi Sunak, the Chancellor, said he could not "wave a magic wand" to solve the supply chain crisis, stressing that industry had to rethink the way its supply chains operated.
  • Paul Scully, the business minister, said firms had a "collective responsibility" to find solutions, while Kwasi Kwarteng, the Business Secretary, said firms had become too reliant on too few suppliers.
  • Business leaders hit back, accusing the Government of "starting to panic" in the face of potential shortages at Christmas and "getting their excuses in early".
  • The Telegraph understands that concerns about supermarket supply chains were raised by ministers during Operation Yellowhammer, the planning exercise for a no-deal Brexit that was carried out three years ago.
  • Some reorganised their supply chains to withstand shocks, while others "had no business plan at all", according to one source, and assumed the Government would step in to sort out any problems.
  • UK businesses are now demanding that the Government makes it easier for foreign workers to get visas, saying they need to pay better wages to attract more staff into sectors where there are shortages.
  • Mr Johnson has sought to claim recent wage growth as a victory for his levelling up agenda, despite fears that soaring inflation as Covid restrictions ease is undercutting the impact of such growth.

Statistics:

  • The number of supermarkets in the UK that have complained about supply chain problems: 3 major supermarkets.
  • The number of Cabinet ministers who are furious at companies trying to shift blame on to the Government: 5.
  • The number of temporary visas allowed for lorry drivers: thousands.
  • The percentage of food prices that may rise due to higher wages for hauliers: modest.
  • The number of foreign butchers that pig farmers are demanding visas for: 1,000.
  • The number of Christmas shortages predicted: 10-20%.

Sources:

  • "Drunk on cheap labour", Cabinet ministers are critical of businesses for failing to prepare for the post-Brexit economy.
  • [Rishi Sunak] said he could not "wave a magic wand" to solve the supply chain crisis, stressing that industry had to rethink the way its supply chains operated. (Source: The Telegraph, October 2021)
  • [Paul Scully] said firms had a "collective responsibility" to find solutions, while Kwasi Kwarteng, the Business Secretary, said firms had become too reliant on too few suppliers. (Source: The Telegraph, October 2021)
  • Business leaders hit back, accusing the Government of "starting to panic" in the face of potential shortages at Christmas and "getting their excuses in early". (Source: The Telegraph, October 2021)
  • The Telegraph understands that concerns about supermarket supply chains were raised by ministers during Operation Yellowhammer, the planning exercise for a no-deal Brexit that was carried out three years ago. (Source: The Telegraph, October 2021)

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