Rapid reform needed to tackle crippling staff shortages

The industries facing the greatest difficulties in recruiting staff include construction, production and manufacturing, logistics; and hospitality with 78 per cent or more saying they can’t find sufficient labour.

The BCC is proposing an urgent reform of the shortage occupations list (SOL) needed to cover more people and job roles.

New figures released by BCC revealed firms’ recruitment struggles remain at record high levels. The data for the leading business group’s Quarterly Recruitment Outlook (QRO) for Q2 2022 was drawn from a survey of over 5,700 businesses. 

Attempted recruitment in Q2 remained broadly the same as the previous quarter, with 61 per cent of firms looking to find staff (60 per cent in Q1 2022). But more than three-quarters of firms (76 per cent) continued to report recruitment difficulties, dropping just 2 percentage points from Q1 (78 per cent).

The construction sector is facing the most severe recruitment challenges, with 83 per cent reporting difficulties. This is closely followed by production and manufacturing on 79 per cent, logistics on 79 per cent and hospitality on 78 per cent.

In the face of rising business costs, less than a third of employers (28 per cent) have increased their investment in the last three months. Smaller firms are even less likely to report an increase, at just 19 per cent.

Head of people policy at the British Chambers of Commerce, Jane Gratton, said businesses remain under huge pressure to fill jobs, but record levels of recruitment difficulty are showing no signs of improvement. 

“Solutions are urgently needed, so that firms can keep their doors open throughout these tough times,” she said.

“We have written to the Government outlining a three-point plan on how they can work with businesses to solve this.”

The strategy proposed by the BCC includes encouraging firms to find new ways of unlocking pools of talent – by investing more in training their workforce, adopting more flexible working practices and expanding use of apprenticeships.

It also said government must help employers invest in training by reducing the upfront costs on business and providing training-related tax breaks and the shortage occupation list (SOL) must be reformed to allow sectors facing urgent demand for skills to get what they need.

“The SOL is not currently fit for purpose and should be more flexible, so it supports firms experiencing a national recruitment crisis. Recruitment difficulties have been at record highs for a year,” Ms Gratton said.

“There are 1.3 million unfilled jobs in our economy and now fewer people in the workforce than before the pandemic. This is holding back productivity and growth, and employers are at their wits’ end. It is putting livelihoods at risk and damaging the economy.

“The Government must reform the SOL criteria to include more jobs at more skill levels to give firms breathing space to invest in their workforce.

“Employers cannot wait for a new Prime Minister before this is sorted. Shortages are impacting not only on their ability to service order books but also on the morale and wellbeing of their people.

“The economic challenge we are facing is huge and unless we start to fill the hole caused by 1.3 million vacancies, we cannot get back to growth.”