SCOTTISH Engineering’s chief executive warns the UK Government’s plans to overhaul immigration policy post-Brexit are “unwelcome” and “disturbing news”, in the industry body’s latest quarterly economic report published today.

Paul Sheerin flags difficulties for the sector arising from the UK Government’s plans to move to an Australian-style, points-based immigration system after the end of free movement of people between the UK and European Union countries on December 31, when the transition period finishes.

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Writing in the report, Mr Sheerin describes the UK Government’s confirmation of its plan to overhaul immigration arrangements as “an unwelcome point of clarity on Brexit”.

He adds: “This is disturbing news for our sector where the salary caps (thresholds) remain above ordinary operator level and many companies are already struggling to recruit semi-skilled staff. Given Scotland’s forecast population shrinkage, a more flexible immigration system which reflects the needs of our labour market is still required.”

The survey shows a sharp slowing of growth of output volumes but a renewed in order intake for engineering companies north of the Border in the latest three months.

Subtracting the proportion experiencing a fall from that recording a rise, a net two per cent of respondents achieved an increase. In the previous quarterly survey, a net 11% had posted a rise.

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A balance of 8% of engineering companies in Scotland recorded an increase in order intake in the latest three months. In the previous quarterly survey, a net 11% had reported a fall.

The survey shows a slowing of the rate of decline of export orders for Scottish engineering companies. However, employment growth in the sector slowed.

It shows 92% of respondents recognise the declared climate emergency is real and requires an urgent response. And 64% say their organisation is actively pursuing operational changes aimed at supporting reduced climate impact.