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Brexit uncertainty is having a profound effect on tech businesses in the North, according to an annual skills audit by Manchester Digital. With the skills gap widening as negotiations continue, how can the region pull together as a community to keep afloat?


Barely a day has gone by since the referendum result without Brexit appearing in the headlines – either through the to-ing and fro-ing of negotiations or the effect the uncertainty of the times is having on us. Now, Brexit’s latest spotlight-stealing appearance comes hot on the heels of Manchester Digital’s latest annual skills audit.

manchester tram

Revealing the results of the audit; which surveyed 250 digital and technology businesses; at the sixth annual Digital Skills Fair, Manchester Digital’s Managing Director; Katie Gallagher, highlighted Brexit’s impact on “an inability to train and retain the best talent” in an “industry which is flourishing in the North West.”

With the fallout of Brexit still in its early days there’s surely more impact to come. But how has the decision to leave the EU affected tech businesses in the North and how can the community recover before it’s too late?


Behind the Audit

For a while before the referendum and continuing long after, critics have pointed out how industries such as healthcare, retail and facilities management are likely to suffer. This is because these industries rely on skilled workers from outside the UK, the supply of which would be heavily restricted once we’re no longer part of the European Union.

software skills gap uk

Anxiety around skills and labour has now surfaced in other industries too, including tech and digital. Those businesses surveyed by Manchester Digital were a testament to this sentiment, with 56% anxious about losing key staff members if overseas workers’ rights are changed. The position most frequently on the radar, yet also the most elusive, was developer – as cited by 49% of respondents – with applicants often not reaching the required skill level.

Meanwhile, 48% have seen work slowed down or delayed ever since the result of the referendum was announced, whilst 27% have purposely turned work away because they haven’t been able to find the right talent. Altogether, 45% stated that Brexit had negatively impacted their businesses in some way.


Why This Matters

When many think of Brexit and its impact on businesses, they first conceive of the financial implications: will Britain have to forge new trading partners? Will we have more competition overseas? And will the falling value of the pound affect the bottom line? What Manchester Digital’s audit shows is that there’s a far more insidious fallout from Brexit, affecting something not so easily remedied by trade agreements or economic intervention: skills and talent.

ambulance NHS

Thrust into the limelight once again, the tech and digital skills gap is proving itself to be a stubborn gulf to close, made even worse by the prospect of losing access to overseas workers with much-needed talents. The NHS and the construction industry are each facing a similar crisis, as the flow of nurses, doctors, workers and managers into the country has been stemmed by increasing concern over the longevity of Britain’s relationship with the EU.

If the North’s tech community is to weather the Brexit storm, it needs to turn to itself and the organisations already making a difference to stabilise the skills gap – rather than wait for government intervention.


What Should We Do?


“Uncertainty around Brexit – whilst clearly an important issue – is one over which we have very little control. The onus therefore falls on the industry to take a proactive approach to solving our own talent problem.”

Katie Gallagher, Manchester Digital

Via Prolific North


Thanks to the audit, we’re able to see exactly where Brexit is hitting the industry the hardest and engineer a solution from that perspective. In this case, if skills and much-needed positions are being limited by our changing relationship with overseas employees, we need to invest in training and developing skills at home.

As I previously talked about on the Kaleida blog, Manchester has been exploring how to close the skills gap for some time, with innovative schemes in place to reinforce the local community. In tackling Brexit’s impact, however, we need to widen the scale of response and find a region-wide solution.

uk skills gap manchester

As Manchester Digital’s Katie Gallagher pointed out following the announcement of the audit’s results, this should involve forging a relationship between what is taught in the classroom and the skills most desperately needed by the industry in its current position. This approach works to directly address specific skills gaps – such as the aforementioned developer role – whilst providing job opportunities straight from school. 

Meanwhile, businesses also need to invest in their employees to prevent Britain from falling behind overseas competitors as AI and data science evolve within the workplace. Providing the opportunity to improve their skills will also see businesses successfully retain talented individuals who can be trained to match new challenges and skills limitations.


Uncertain waters

Unfortunately, Brexit will continue to provide uncertainty as we approach the fateful end of negotiations – and we don’t necessarily have a say in that uncertainty. What we can – as a community – affect is how the tech and digital industries react and how we weather what’s to come.

uncertainty brexit

If we’ve learnt anything from Manchester Digital’s audit, it’s that no one is alone in feeling anxious around the impact of Brexit on their business. With the challenge laid out in black and white before us, all we have to do now is rise to the occasion, together.

If you’d like to read the full audit, you can do so on Manchester Digital’s website.

Kaleida is proud to be a member of the North’s tech community. We’re a development house creating bespoke software solutions for clients across a number of industries. To find out more about what we offer, feel free to explore our website or get in touch directly to talk to our team.

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