British companies are finding it harder and harder to find the right staff.
According to a report published Tuesday, availability of workers for both permanent and temporary positions fell at the fastest pace in 16 months in April.
The Recruitment and Employment Confederation said there’s a shortage of suitable applicants across a wide range of industries and that Brexit may exacerbate this problem.
“We have the lowest unemployment rate since 2005, and people already in work are becoming more hesitant about moving jobs amid Brexit uncertainty,” said Kevin Green, chief executive of REC, which compiles the report with IHS Markit.
In addition, “lack of clarity about future immigration rules is putting off some EU nationals from taking up roles in the U.K.”
Green also warned that the shortage could have wider implications, such as damaging the very industries the government is counting on to thrive when Britain leaves the EU.
“The exceptional reputation U.K. engineering enjoys globally is at risk because employers can’t find people with the skills they need,” he said.
Responding to the report, Open Britain, which campaigns to soften Brexit, said the government must drop its “divisive and damaging immigration target, which if achieved would come at the expense of jobs and economic growth.”
Separately, two reports on Tuesday showed retailers had a strong April due to the Easter holiday. The British Retail Consortium said sales rose 5.6 percent from a year earlier and Barclaycard said consumer spending was up 5.5 percent.
While the industry body welcomed the holiday boost, it noted the “positive distortion” and warned that the longer-term outlook “isn’t as rosy.”