Urquhart Castle stands on the banks of Loch Ness near Inverness, Scotland
By Elisabeth O'Leary
INVERNESS, Scotland (Reuters) - Glen Mhor Hotel, a picturesque base for tourists hunting Scotland's Loch Ness monster, is struggling to find staff for the summer season as workers from the European Union snub Brexit Britain.
While Prime Minister Theresa May battles to win support for her plans to leave the EU, a shortage of migrant workers from the bloc is already threatening Scotland's economy and upsetting its politics.
Migration is a major source of irritation between London and Edinburgh. It is also one reason behind a new drive for Scottish independence from Britain.
EU migrants account for half the hospitality workforce in the city of Inverness, a hub for the Highlands tourist region popular with golfing Americans and whisky-sipping Europeans.
But local cleaning and cooking staff for the 75-room Glen Mhor are proving hard to find. Unemployment in Inverness stands at 3 percent compared with 4.2 percent in Britain as a whole.
With Brexit looming, the Victorian hotel's manager, Frenchman Emmanuel Moine, is struggling to recruit.
"Last year I advertised for a chef de partie in a specialist French hospitality newspaper and I got 50 resumes in a few days," Moine said, in an elegant hotel lounge overlooking the River Ness. "I didn't get one from the UK."
Potential staff from the EU are put off by the prospect of tougher immigration rules and a weaker pound reducing the amount of money they can send home in euros.
Sparsely populated Scotland is ageing rapidly so labour shortages affect its economy more than the rest of Britain. Stemming the inflow of EU workers, as May's government plans, will be "catastrophic", Edinburgh says.
"Severe restrictions on immigration pose a genuine risk to the long-term health of our economy and our society," Scotland's First Minister Nicola Sturgeon says.
Home to just 5 million of Britain's 66 million people, Scotland's vote to remain in the EU was outweighed by the rest of the country.
Scotland's working age population will only remain stable over the next 25 years if current migration rates persist, a University of Edinburgh study said. Migrants' taxes and economic activity help to fund public services in areas where the population is falling.
The Scottish Fiscal Commission projected that if the UK government met its target of reducing net migration to the "tens of thousands", the Scottish economy would shrink by around one fifth more than the rest of the UK by 2040.
Moine, Glen Mhor's manager, says the Brexit vote had a "brutal, immediate" impact on his attempt to recruit up to 90 workers needed in the summer. He now pays his cooks 15 percent more than in 2016, the year Britain voted for Brexit.
In Britain as a whole 37 percent of workers in hospitality are non-British EU nationals, the Federation of Small Businesses says. In Scotland that number is 45 percent, and in the Highlands local hoteliers say it is about 50 percent.
In densely populated England, many people voted for Brexit because of fears about migration. But in Scotland foreign workers help offset a birthrate at a 150-year low and keep the rural areas economically viable.
Scots rejected independence by a 10 point margin in a 2014 referendum. But many of Sturgeon's supporters say plans to end free movement of EU citizens as part of Brexit amount to a huge change in Scotland's circumstances that necessitates another independence vote.
Thousands of volunteers are planning a door-to-door campaign in support of independence. They hope to win over EU nationals living in Scotland who mostly rejected independence in 2014.
"We're quite confident it will be the opposite next time around and we'll get a pretty solid majority of EU nationals," said Ross Greer, a pro-independence Scottish Greens lawmaker, who is involved in the campaign.
EU migration to Britain has fallen since June 2016, and net migration of EU citizens in the country fell to its lowest since 2009 in the year to September. The Scottish government estimates EU nationals in Scotland have fallen 5 percent to 223,000.
Meanwhile some workers at Glen Mhor are waiting see what Brexit actually means for them.
"This is good place to work, money is good and you can live well on the minimum. After Brexit, I don't know what to tell you," says Marta Ofiarska, a 41-year-old housekeeper at Glen Mhor who has been in Scotland for 13 years.
But her 21-year-old daughter went back to Poland after the 2016 Brexit vote and at least 20 of her Polish friends have left Scotland since then.
(Reporting by Elisabeth O'Leary; Editing by Giles Elgood)