The UK’s place at the Med Tech top table could be under threat By Ivor Campbell
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A seat in the Boardzoom Remote working has seen more top med tech executives recruited by overseas companies
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he mass switch to home working caused by the coronavirus is having a major impact on the UK’s recruitment practices, with companies now enabled to hire significantly more overseas-based executives. More firms are prepared to have senior decision makers located abroad after discovering the effectiveness of remote working. And while it has had a positive impact on industry, widening the talent pool available to UK firms, the trend could mean less tax revenue generated by the Treasury as many of the workers won’t pay UK tax. More than 90% of Snedden Campbell’s business is now done for UK-based companies, many of them start-ups and pre-revenue, compared with around half prior to the pandemic, We have done business from San Diego to Dubai and, when I look at what we’ve been doing for the last six to nine months, almost everything we have done has been in the UK, which is completely different from the situation before Covid. One thing that has come through, that’s genuinely interesting, is that prior to the pandemic, if you were going to place someone in a senior role, the expectation was that they
would be there on your premises one hundred per cent of the time unless they were in front of a client at a tradeshow or travelling to be in front of a client or at a tradeshow. What we have found now is that companies will more readily accept that a lot of roles can be done remotely and it’s win-win because, they can now put their hands on people whom they would never have been able to hire before because they would have had to relocate them – they would have had to pay a fortune to get them to come wherever they are – always assuming that the candidate was willing to relocate in the first place. If they can live with that individual coming in one day a week or five days a month, and doing the rest of the role remotely, then all of a sudden, they have a much bigger talent pool than they had 12 months ago. We’ve all learned how to use Zoom
and it works. Everyone is a convert. You just have to get your head around the fact that your business meetings are not going to be in person around a table in Oxford – they will be around a virtual table and there will be one person from the US, one person from India and three people based in Europe. As well as saving employers the cost of relocating senior executives from overseas, typically mainland Europe but also the US and, increasingly South Asia and Asia Pacific, they are also able to pay local rates and taxes if most of their work is done in their own countries. The trend has been fuelled by an exodus of overseas workers caused by Covid and Brexit, according to the Chartered Institute of Personnel and Development (CIPD) which recently reported a sharp decline in the numbers of EU workers in the UK, hence the increased interest by employers to allow remote working for people who won’t now cross the Channel and to fill the remaining gaps with
talent at much greater distances. At the same time jobs website Adzuno found the number of overseas job searches from western Europe and North America had halved to 250,000 since the start of the pandemic. As with the 2008-09 financial crisis, there is always the possibility that the risk appetite of candidates falls and this hurts earlier stage, and by definition riskier, businesses disproportionally. However, the ability to work remotely will help to override labour shortages in scientific, technical and engineering sectors. We continue to place more people in the most senior roles – they are also a reflection of confidence out there in that they are not replacements but a product of an expanding sector. These are new people, either for established companies that are growing, or new companies that have significant investments and are bringing people on to convert that investment into profit. It’s not steady state, there is clear growth there. Around 40% of what we’ve done since things started to come back after the lockdown last summer has been through companies that are new to us. Of that, the majority have been companies that are relatively new, early-stage businesses. Mostly, it’s companies that have seen growth because there has been greater interest in diagnostics. A lot of them have nothing to do with infectious disease, they are dealing with other things.
ne of positive outcomes of the UK’s response to the Covid pandemic has been a significant growth in our medical technology industry. From nowhere a year ago, PCR testing is a term now familiar to the public. Existing medical technology companies are reconfiguring their operations to address a burgeoning demand for diagnostics equipment and new companies are springing up all the time. So why, in the face of this unprecedented demand, are we now faced with an impending shortage of world-class scientists, engineers and technologists? Growth in demand for diagnostics business specialists in the past year has effectively vacuumed up all of the existing talent, with companies being forced to pay ever higher salaries to existing industry specialists. Board-level executives with technical, scientific, or engineering qualifications, now routinely command salaries around £150,000-a-year, while experienced engineers involved in research and development and transfers to production, are regularly employed on salaries of £120,000. In some cases, those are double what they could have expected five years ago. However, the pipeline of top overseas graduates from China and the Far East, that this country has traditionally relied upon to meet ongoing demand, appears to be drying up. Companies are increasingly reporting that research students are being put off coming here because of a perceived resistance to immigration herefollowing Brexit and greater hurdles. Peter Hewkin, founder of the Cambridge-based Centre for Business Innovation and head of the global Microfluidics Consortium, recently told me that, rightly or wrongly, since Brexit, the UK is now perceived as less friendly to overseas students, not just from Europe, but from further afield. A secondary effect is that British companies are hiring these graduates, not into Britain but into overseas outposts – places like Vietnam, Taiwan and Malaysia.