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Overseas workers reinforce the economy

Small and medium size enterprises employing migrant workers has doubled

08 November 2008. Business owners fear they could be left with gaping holes in their workforce as migrant workers choose to return home, according to a a new research. The biggest shake-up of the immigration system for 45 years comes into force this week just as the UK economy turns into recession.

The report published by the Tenon Forum shows the number of small and medium size enterprises (SMEs) employing migrant workers has more than doubled in the past two years, with nearly half of UK SMEs (48%) now saying that they employ non-UK nationals compared to 21 per cent in 2006.

The greatest proportion of entrepreneurs employing foreign workers is in London, where 64% of employers have non-UK residents as part of their workforce. In the East Midlands, 50% of SMEs now report that they employ non-UK nationals. The North West has the lowest number of SMEs employing migrant workers at 32%.

However, as the economy faces increasingly difficult times and the pound continues to weaken, one in four entrepreneurs who employ non-UK nationals are concerned they may choose to return home.

This would come as a huge blow to those entrepreneurs who are opting to source workers from foreign climes due to dissatisfaction with UK employees. 15% of those who employ foreign workers believe their international employees have a better work ethos than their UK colleagues and almost one in five (17 per cent) cite the lack of skilled workers in the UK as a reason for employing migrant workers.

On a more positive note, 17% of employers believe that having an international workforce has a positive impact on company culture while 72% say they simply employ the best person for the job.

Alistair Wesson, Nottingham based regional managing director at Tenon, commented:

“With so many entrepreneurial businesses now employing non-UK nationals, it is vital that managers make themselves fully aware of the new points based system for employing migrant workers – or they could be faced with fines of up to £10,000 per illegal employee. In times of such economic uncertainty, entrepreneurs need to make sure they have procedures in place which will protect their business from unnecessary disruption, and staff turnover is no exception.”

However, according to the Tenon Forum research, nearly a third of entrepreneurs say that they do not currently employ foreign workers and have no intention of doing so in the future. While 47% claim that this is simply because they do not receive applications from international workers and 28% are keen to support their community by employing local residents.

The research was carried out online between 25th April and 5th May 2008. The survey covers all business sectors across the whole of England, Scotland and Wales. A regular survey of SMEs is carried out every six months for the Tenon Forum.

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