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Brexit: Startups worry for London’s talent

The food and tech sectors have been especially buoyed by access to workers in recent years. ‘Talent flight’ has been identified as the biggest threat to London’s startup scene post-Brexit.

26 Jul 2016

Some industries are heavily reliant on European workers: around a third of the UK’s tech employees are EU migrants, while one in eight in London’s food scene are from the continent.

Businesses reliant on specialist skills, especially in the tech sector, say they’ve been able to grow quickly thanks to access to a rich pool of talent drawn from around the world and Europe in particular. Nowhere is this clearer than in London – Europeans currently represent 13 per cent of the capital’s workforce.

Watch the talent

Understandably, freedom of movement is the issue causing most jitters among businesses, and the one most urgently demanded of politicians to get certainty around. What will happen to the existing three million EU nationals working in the UK and what will be the terms with which British companies can recruit people from Europe in the future?

Companies Courier spoke to said their European staff were anxious. Several also said the uncertainty left them having second thoughts about appointing Europeans. In the past, it’s been skilled workers from the US and Asia who businesses have sometimes avoided, due to the burdensome administration and form-filling required – which could soon be the same for EU nationals.

London’s lure as a richly cosmopolitan city is hoped to insulate it from other (cheaper) cities’ bids to attract talent.

What the startups say

‘We employ 100 people in the UK, and about 60 per cent are from the EU. If people can only work for one or two years before leaving, it’s a big risk for us to take them on. We invest a lot in training.’ Rachael Power, Taylor Street Baristas

‘Today, I might think twice before making a job offer to someone with an EU passport. Our latest team member is Italian but going forward, it would be irresponsible not to consider the uncertainty.’ Gabriela Hersham, Huckletree

‘This is a healthy reminder that London is one great city among many; it’s by no means the default choice for talent.’ Jason Goodman, Albion

‘Over half of our 200-strong volunteer team were born outside of the UK. The threat to free movement on future travellers across Europe – and worst, of enforced deportation for existing ex-pats – is hugely impactful. Music thrives in a melting pot of culture and people. The fewer flavours in the pot, the blander the taste.’ Tom Lovett, Sofar Sounds

‘It’s often easier to hire from the EU than England. It’s easier to convince them to move to Scotland! And there’s not the expense or inconvenience of visas and paperwork.’ Doug Hare, Outplay

‘It’s already been extremely difficult to bring in highly skilled labour from outside the EU. Added to this, post-Brexit, is the possible shortage of quality, front-of-house and less-skilled labour, which currently comes, in a large part, from EU countries.’ Alan Yau, restaurateur

‘I worry about London and the UK becoming more isolationist, less accepting of new people and therefore ideas. We’ve always been such a creative hub because we’ve been excellent at sharing our ideas and accepting those of other people. UK music wouldn’t exist without heavily importing other cultures, both from abroad and from immigrants.’ Caius Pawson, Young Turks

This story is part of a special report on Brexit’s impact on startups – covering fintech, currency, investment, talent, regulation and funding – featured in Courier Aug/Sept.