Introduction
The United Kingdom’s exit from the European Union, commonly referred to as Brexit, on 31 January 2020 marked a significant shift in its relationship with the EU, particularly concerning the free movement of workers as enshrined in Article 45 of the Treaty on the Functioning of the European Union (TFEU) (2007). This principle, which guarantees EU citizens the right to seek employment and work in any member state without discrimination, no longer directly applies to the UK post-Brexit. The assertion that this change will lead to a reduction in European workers coming to the UK, consequently harming the economy, warrants critical examination. This essay explores the legal implications of the loss of free movement under Article 45 TFEU, evaluates the potential reduction in EU workers, and assesses the broader economic consequences for the UK. Drawing on academic literature, legal texts, and official data, the discussion will consider both the challenges posed by restricted labour mobility and potential mitigating factors.
Understanding Article 45 TFEU and Free Movement of Workers
Article 45 of the TFEU establishes the foundational principle of free movement for workers within the EU. It stipulates that “freedom of movement for workers shall be secured within the Union” and prohibits discrimination based on nationality regarding employment, remuneration, and other conditions of work (TFEU, 2007, Article 45). This provision has historically facilitated a dynamic labour market across member states, allowing workers to relocate where demand exists, thus addressing skill shortages and contributing to economic growth. For the UK, prior to Brexit, this meant access to a vast pool of labour from the EU, particularly in sectors such as healthcare, agriculture, and hospitality, which have relied heavily on migrant workers (Vargas-Silva and Rienzo, 2019).
Post-Brexit, the UK is no longer bound by Article 45 TFEU, and EU citizens seeking to work in the UK must now navigate a points-based immigration system introduced in January 2021. This system prioritises skills and qualifications over nationality but imposes stricter entry requirements, including visa applications and salary thresholds (Home Office, 2020). Critics argue that these barriers deter EU workers, particularly those in lower-skilled roles, from coming to the UK, thus disrupting the fluidity of labour supply that Article 45 once guaranteed (Portes, 2016). While the legal framework has clearly shifted, the extent to which this translates into a tangible reduction in EU workers requires further scrutiny.
Impact of Brexit on EU Worker Numbers in the UK
There is evidence to suggest that Brexit has indeed contributed to a decline in EU workers seeking employment in the UK. Data from the Office for National Statistics (ONS) indicates a notable drop in net migration from the EU since the 2016 referendum, with a marked acceleration after the transition period ended in December 2020. For instance, the ONS reported that EU net migration fell to an estimated -94,000 in the year ending June 2021, compared to positive figures in previous years (ONS, 2022). This shift is attributed partly to the end of free movement and the introduction of visa requirements, which have made the UK a less attractive destination for EU workers (Sumption, 2021).
Moreover, specific industries that previously depended on EU labour are already experiencing shortages. The National Health Service (NHS), for example, has reported challenges in recruiting EU nurses, with a 2021 report highlighting a 12% decrease in EU staff applications since Brexit (NHS Confederation, 2021). Similarly, the agricultural sector has faced difficulties during harvest seasons, with reports of unharvested crops due to a lack of seasonal workers from the EU (Environment, Food and Rural Affairs Committee, 2022). These examples illustrate a direct link between the cessation of free movement under Article 45 and a reduction in EU workers, supporting the initial assertion of a decline in labour inflows.
However, it is worth noting that not all EU workers have been deterred. The EU Settlement Scheme, which allowed pre-Brexit EU residents to secure their status in the UK, saw over 6 million applications by mid-2022, indicating that many chose to remain (Home Office, 2022). Furthermore, some argue that the points-based system may attract higher-skilled EU workers, potentially offsetting losses in lower-skilled sectors (Sumption, 2021). Thus, while a reduction is evident, its scale and long-term implications are not uniform across all sectors or skill levels.
Economic Consequences of Reduced EU Labour
The potential economic impact of fewer EU workers in the UK is a subject of intense debate. On one hand, sectors reliant on migrant labour, such as hospitality and construction, are likely to face increased operational costs due to labour shortages, potentially leading to higher consumer prices and reduced output (Portes, 2016). The Bank of England has also suggested that restricted migration could contribute to inflationary pressures by tightening the labour market (Bank of England, 2021). Additionally, the Migration Advisory Committee (MAC) has warned that persistent shortages in key roles could hinder economic recovery post-pandemic, particularly in health and social care (MAC, 2022).
On the other hand, proponents of Brexit argue that reduced reliance on EU labour could encourage investment in domestic workforce training and automation, fostering long-term economic resilience (CBI, 2020). There is also the possibility that the UK’s new immigration policies may attract skilled workers from non-EU countries, diversifying the labour pool and mitigating some economic risks (Sumption, 2021). Nevertheless, these solutions require time and investment, and short-term disruptions remain a significant concern. Arguably, while the adverse economic effects are not inevitable, the immediate challenges posed by labour shortages cannot be dismissed.
Conclusion
In conclusion, the assertion that the UK’s exit from the EU will lead to a reduction in European workers and adversely affect the economy holds considerable merit, particularly when viewed through the lens of Article 45 TFEU and the subsequent loss of free movement. Empirical data confirms a decline in EU migration to the UK post-Brexit, with tangible impacts on sectors such as healthcare and agriculture. Economically, while the long-term effects remain uncertain and could be mitigated through domestic policy adjustments, short-term disruptions in the form of labour shortages and inflationary pressures are evident. This analysis highlights the complex interplay between legal frameworks, migration patterns, and economic outcomes. Ultimately, while the UK may adapt to its post-Brexit reality, the immediate challenges underscore the significant role that EU workers, supported by Article 45, played in sustaining the nation’s economy. Future policy must therefore strike a balance between controlling immigration and addressing critical labour needs to avoid sustained economic harm.
References
- Bank of England (2021) Monetary Policy Report. Bank of England.
- CBI (2020) Building a Stronger UK Workforce Post-Brexit. Confederation of British Industry.
- Environment, Food and Rural Affairs Committee (2022) Labour Shortages in the Food and Farming Sector. House of Commons.
- Home Office (2020) The UK’s Points-Based Immigration System: Policy Statement. UK Government.
- Home Office (2022) EU Settlement Scheme Statistics. UK Government.
- Migration Advisory Committee (MAC) (2022) Annual Report 2022. UK Government.
- NHS Confederation (2021) Staffing the NHS Post-Brexit: Challenges and Opportunities. NHS Confederation.
- Office for National Statistics (ONS) (2022) International Migration, England and Wales: Year Ending June 2021. ONS.
- Portes, J. (2016) Immigration, Free Movement and the EU Referendum. National Institute Economic Review, 236, pp. 14-22.
- Sumption, M. (2021) The Post-Brexit Immigration System: Challenges and Opportunities. Migration Observatory, University of Oxford.
- Treaty on the Functioning of the European Union (TFEU) (2007) Consolidated Version, Official Journal of the European Union.
- Vargas-Silva, C. and Rienzo, C. (2019) Migrants in the UK Labour Market: An Overview. Migration Observatory, University of Oxford.
