Well here we are, just several months away from a looming “No Deal” Brexit, a position none of us (whether you voted remain or leave…) wanted to be in and one that 5 years ago would have seemed unimaginable. Boris Johnson sends a clear message “We are going to leave the EU on October 31st”.
The implications of a “No Deal” Brexit on the European pharmaceutical supply chain will be immense with imports and exports into the UK under risk. While the UK is widely considered a service based nation with over 75% of exports being services. There is still a pharmaceutical export market (to the EU) worth over £12 billion, and with 73% of UK pharmaceutical imports coming from the EU (U.K. Office for National Statistics, ONS), it doesn’t take a genius to understand that a no deal Brexit offers all sorts of complications.
While it is not likely the UK will experience a large amount of increased costs to existing products due to tariffs (Due to the World Trade Organisation’s international commitments and the fact that most finished medicines are tariff free under the EU’s Common External Tariff law) some products / ingredients will still be at risk and there are logistical and regulatory barriers which could be extremely costly. As a highly-regulated industry, the prospect of regulatory divergence from the European Medicines Agency is a deep concern for the industry. It could result in the duplication of facilities and roles across the UK and EU to enable access to products, costing companies and tax payers tens of millions to build and operate.
However, what continues to fly under the radar is the dependency the UK has on EU pharmaceutical talent. The UK has already become a less-attractive employment destination following Brexit, and it is clear that the number of EU citizens moving to the UK has declined to its lowest levels since 2003 (Migration Statistics Quarterly Report: February 2019 ONS). Since the Brexit announcement in 2016 the amount of immigration per year has dropped by almost 1/3rd (over 100,000), experienced under the level of uncertain surrounding the negotiations.
The severity of this impact will depend on how negotiations progress over the next few months: an agreement to continue free movement between the UK and the EU would facilitate easier movement of talent, but being able to reach an agreement this late towards the deadline doesn’t seem very likely (sorry for my lack of optimism…). Not to mention that the application of current UK immigration rules (non-EU) on to EU movement may prove far more restrictive, with much more bureaucracy. UK-based organisations will be less than prepared to cope in the short term.
It is very likely that we will no longer offer easy access to talented people from throughout the EU. It is certainly possible that the UK will continue to experience a decline in the number of EU citizens coming here to work, considering the numbers have already decreased substantially. The Pharmaceutical industry depends heavily on highly trained / educated individuals in what is globally a competitive talent market.
According to the UK Labour Market Outlook Autumn 2018 by Addecoo & CIPD Institute, recruitment complications are continuing to increase since 2016. Organisations (across all industries) with hard-to-fill vacancies are claiming that 43% of their total vacancies are proving hard to fill, and 7 in 10 organisations report overall recruitment difficulties. This is a direct result of trying to attract and retain individuals in the face of increased competition for a smaller selection of talent.
Europe is already fighting over specialised talent due to the rapid expansion of the Pharmaceutical industry (especially within biologics/cell & gene therapy). So considering companies will being limiting themselves to the UK, which is only 13% of the population of the EU, HR teams and hiring managers need to have talent contingency plans in place (that really should have been implemented 2 years ago).
So what can they do?
1.) Develop a Strategy – It is essential to understand exactly where the hiring bottle necks can or could occur. Having knowledge of the internal team, the attrition risk, and the difficult to fill vacancies means they can develop a strategy of how to fill the gaps, and hire quickly and efficiently. Research and external talent market analysis are key.
2.) External Partnerships – The value of a good external recruitment consultant with a years experience focused on the life sciences industry is essential, access to passive networks of candidates and professionals will be more important now then ever before.
3.) Invest – Invest in university or entry level training and development programs, increase the amount of talent developed internally. This can provide a large entry level talent pool into the talent pipeline.
4.) Evaluate – Many times the solution for filling difficult roles lies internally, so having open and honest conversations with employees to see what areas they are interested in provides additional options. Offering training/courses to get employees the skills in areas the business lacks not only challenges your employees but is a great solution to make your teams more fluid and flexible.
5.) Process & Diversify – While it will be more difficult to provide a more diverse workforce due to upcoming policies and legislation, HR teams and internal recruiters can invest more time in understanding immigration policies. It means providing a much more structured process that allows them to present a case to immigration agencies and allows the ability to process Visa applications quickly and efficiently for hard to find talent.
While this is a start, is it enough?! What else would you recommend or what else could be implemented?