Abstract
Restrictive immigration policies can force organisations to alter their workforce composition, with unclear effects on organisational performance. We study the effects of the 2016 Brexit referendum, which reduced the share of EU-nationality nurses in English hospitals. Using administrative patient-level data and a continuous difference-in-differences design, exploiting hospitals’ pre-referendum exposure, we estimate the causal impact of a negative labour supply shock on care quality. Hospitals with higher pre-referendum EU nurse shares experienced higher post-referendum emergency patient mortality, equivalent to 1,238 additional deaths annually in the three years after the referendum. Consistent with theoretical predictions, hospitals responded to labour shortages by relaxing hiring standards: foreign nurses recruited after the referendum were appointed to lower salary grades, suggesting lower skills and experience.