Ian McConnell

THE business community in Scotland and the UK as a whole, while generally swift and polite in congratulating Boris Johnson on his clear majority, was equally quick to set out the importance of immigration to future economic prosperity.

This sets the stage for the most likely point of protracted friction between the Conservative Government and the business community as Mr Johnson rushes to take the UK to the Brexit door on January 31 and then secure a future trade deal by the end of next year.

The business community may be relieved Jeremy Corbyn did not achieve victory for Labour or become pivotal in a hung Parliament with radical policies, including corporation tax rises, widespread nationalisation and free broadband.

And business as a whole and indeed financial markets seemed to be prepared to overlook the fact UK economic growth had ground to a halt amid Brexit uncertainty in terms of their favoured policies.

In the run-up to the General Election, it was interesting that business organisations rather toned down their previous fierce criticism of the Tories over Brexit.

The business community, overall, appeared by then to have accepted Brexit was inevitable. Not only that but business also seemed to believe by then that staying in the single market, the least economically damaging form of Brexit on projections published by the previous Conservative administration under Theresa May, would also be impossible.

With Mr Johnson’s big majority, the business community appears to have been correct on both of these points. Brexit now looks certain to occur by January 31, and Mr Johnson and Mrs May before him have made it plain that the Conservatives will not countenance staying in the single market.

So we are looking at a hard Brexit, with the end of free movement of people from and to continuing European Union nations. The business community has long made it clear that this loss is one of its main concerns over Brexit, right up there with or probably in many cases ahead of worries over losing frictionless trade.

The UK as a whole faces major challenges in terms of a need to bolster its working-age population, and this problem is particularly acute in Scotland.

It was notable that Mr Johnson has highlighted his determination to “bear down” on immigration. As the Tories entered the final days of their campaign, this was a key focus for him.

Office for National Statistics data on Tuesday showed the UK economy stagnated during October after declining in each of the previous two months, its worst run since the first quarter of 2009 amid political and economic uncertainty fuelled by Brexit. Comparing the three months to October with the May to July period, UK gross domestic product was flat.

Scottish Chambers of Commerce chief executive Liz Cameron, although extending “congratulations to the Conservative Party for winning the election”, declared yesterday that uncertainty over Brexit had caused “untold damage to the economy” and discouraged businesses from investing.

Calling for a focus on infrastructure investment, she emphasised: “We…need quick answers to international trading arrangements and an immigration policy that is fit for the needs of Scotland and its employers.”

The Federation of Small Businesses in Scotland, while observing the Conservative Party victory and expressing its hope the UK political system had been “rebooted”, also highlighted the fact that the SNP, which has rightly emphasised the importance of immigration to the economy, had “won the vast majority of seats in Scotland”.

In a plea that seems at odds with the Conservatives’ hurry on Brexit, the FSB in Scotland said the new UK Government “must deliver a Brexit deal with a transition period long enough for small businesses to prepare for a change in trading conditions”.

Such time to prepare is a particularly major issue for businesses at the smaller end of the scale, which have fewer resources to divert toward getting ready for change.

Andrew McRae, the FSB’s Scotland policy chair, declared: “All of Scotland’s elected representatives need to press for an immigration system that delivers for our local economies and communities.”

With the Conservatives having pledged in their manifesto not to extend the transition period beyond the end of 2020, and experts highlighting the challenges of securing a future trade deal with the EU in such a dramatically short timescale, fears of an eleventh-hour, no-deal departure will remain.

CBI director-general Carolyn Fairbairn said: “Congratulations to Boris Johnson and the Conservative Party. After three years of gridlock, the Prime Minister has a clear mandate to govern.”

However, she added: “Early reassurance on Brexit will be vital. Firms will…want to know they won’t face another no deal cliff-edge next year. Pro-enterprise policies on immigration, infrastructure, innovation and skills will help relaunch the UK on the world stage.”

The lack of clues about what Brexit will ultimately mean is clearly at the front of business leaders’ minds, and understandably so.

Jonathan Geldart, director-general of the Institute of Directors, said: “Business leaders’ thoughts will immediately be turning to Brexit. For directors, ‘Get Brexit Done’ will only have meaning once the details of our long-term future relationship with the EU are clear – they need a framework to plan for the future from.”

He declared there were “still big question-marks around the Conservatives’ plans on immigration and big-ticket infrastructure projects”.

Business organisations were yesterday as fast to highlight the many major unresolved issues over Brexit as they were to congratulate Mr Johnson.

These are, by and large, the same unresolved issues there were back in 2016, and there is, on the basis of the Tory timescale, very little time to tackle them.

The Scottish and broader UK economic need for immigration, at various skill levels across a raft of sectors, such as hospitality, academia, engineering, manufacturing and information technology, will surely be a major source of debate between the business community and the new Government over coming months and years.