Brexit news: Deutsche Bank’s says UK set for major job shock amid lower immigration | City & Business | Finance

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Germany’s largest bank claimed that British companies will soon be faced with fewer workers and have little choice but to automate more jobs – or offshore work.

UK employers can’t afford to raise wages workers, according to Deutsche Bank.

And they won’t be able to life prices to pay for higher salaries if the company depends on trade for profits because of international competition.

In a note to investors, Deutsche Bank economists Oliver Harvey and Mark Wall wrote: “UK companies exposed to foreign competition have limited ability to raise wages in response to a labour supply shock.

“Margins aren’t high enough to absorb higher labour costs, and international competition will limit the ability to raise prices.

“Faced by labour shortages, then, companies can either a) go out of business b) off-shore production or c) improve productivity.”

It come as migration fell below 250,000 over three months for the first time in three years at the start of the year, the latest official statistics show.

At the same time, unemployment has fallen to a 42-year low, while wages are growing by 2.1 per cent.

The Deutsche report said: “The UK is rapidly pivoting towards a major labour supply shock as a result of falling immigration.

“This shock will be exacerbated by the UK’s weak existing demographics, limited spare capacity in the labour market and, up until now, continuing robust labour demand.”

Companies that don’t depend on exports for profits could raise wages, but this could hurt Britain’s technological advances and productivity, according to Deutsche Bank.

It comes after Deutsche Bank boss John Cryan said Frankfurt will be the biggest winner from Brexit as banks choose the German city to relocate.

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