UK Government immigration reforms could force Scottish businesses to close, warns report

One in five small firms in Scotland could close or radically change their business model due to difficulties in recruiting EU workers, a new report has found.

The study, published today by the Federation of Small Businesses (FSB), said companies north of the Border faced "distinctive challenges" and could be disproportionately impacted by Westminster plans to reduce the number of migrant workers arriving in the UK.

The report said that businesses in Scotland have found it harder to hire the right staff in the last twelve months, with 45 per cent of small businesses in saying they have faced recruitment challenges, compared to a UK average of 38 percent.

The FSB have backed the SNP’s plans for a Scottish Visa system and a migration plan tailored to Scotland’s specific needs – branding Boris Johnson’s plan to slash the number of so-called ‘low-skilled workers’ entering the UK as a “concerning prospect”.

Scotland's population stands at a record high - but growth is already slowing. Picture: John Devlin

But the Home Office said it was time for employers to invest in the people already here and make jobs more attractive for UK workers.

FSB Scotland policy chairman Andrew McRae said: “There are now more than 100,000 EU workers in employment in cities, towns and villages across the country. Needless to say, the imminent introduction of a new way of hiring workers from outside the UK is a concerning prospect.

“Against a backdrop of weak economic growth, a buoyant labour market and an ageing population, it’s critical that we get the post-Brexit immigration system right. The tight timescales mean there’s no margin for error. Getting it wrong risks business closures.”

SNP MSP Tom Arthur said: “This report lays bare the devastating impact the Tories’ immigration plans will have for business owners in Scotland.

“Small businesses are the backbone of our economy and it’s time for Boris Johnson to get his head out the sand and listen to their needs before it’s too late.

“It’s shameful that not a single Scottish Tory MSP or MP can bring themselves to speak out against these plans that will force thousands of businesses north of the border to close their doors for good.

“The clock is ticking, politicians from all sides need to back the SNP’s plans for a tailored migration system that works specifically for Scotland.”

A spokeswoman for the Home Office said: We’re ending free movement, taking back control of our borders and delivering on the people’s priorities by introducing a new UK points-based immigration system.

“Employers will need to join our mission to level-up skills and economic growth across the whole UK so that we deliver a high-skill, high-wage and highly productive economy.

“We will continue to work with stakeholders across Scotland to ensure they understand the detail of our proposals and how they will work for all sectors in Scotland.”