UK Employers Struggle With Worst Labour Shortage Since 1997

3 weeks ago Dammylink 0

Britain’s employers are struggling with the worst staff shortages since the late 1990s, amid the rush to reopen from lockdown and a sharp drop in overseas workers due to Covid and Brexit.

Sounding the alarm over the risks to economic recovery from acute labour shortages, the Recruitment and Employment Confederation (REC) and the accountancy firm KPMG said the number of available workers plunged in June at the fastest rate since 1997.

Recruitment firms are reporting hiring challenges across several sectors of the economy, led by shortfalls in areas such as transport and logistics, hospitality, manufacturing and construction.

As well as the trouble recruiting chefs, kitchen porters, cleaners and warehouse staff recorded in previous months, the snapshot indicated that issues for employers were spreading to typically higher-paying sectors such as finance, IT, accounting and engineering.

“We need action from businesses and government to reskill and upskill furloughed and prospective workers now more than ever, as the increasing skills gap in the workforce has the potential to slow the UK’s economic recovery,” said Claire Warnes, head of education, skills and productivity at KPMG UK.

The rush to reopen after pandemic restrictions is leading to bottlenecks. Employers are finding added complications as fewer EU workers travel to Britain because of Covid-19 border controls and the government’s post-Brexit immigration rules.

According to the REC and KPMG survey of more than 400 recruitment firms, a sharp rise in hiring demand led to the unprecedented fall in the availability of candidates in June. Recruiters noted that increased hiring, Brexit, pandemic-related uncertainty and the furlough scheme all weighed on the number of jobseekers available.

Official figures show about 1.5 million workers are still furloughed with pandemic restrictions still limiting a full return to work, after the government pushed back the date for the end of most pandemic restrictions to 19 July and the Delta variant fuelled rising infections.

Rishi Sunak last week started to wind down the multibillion-pound jobs scheme, which is due to close at the end of September. At its peak almost 9 million jobs were furloughed during the first wave of the pandemic, with about 5 million in the wave in January this year

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