Addressing The Post-Pandemic Skills and Labour Shortage
The post pandemic skills and labour shortage is fuelled by a backlog of crises that stretch back to Britain’s exit from the European Union, deepened by the Covid-19 pandemic and exacerbated by the war in Ukraine against the backdrop of the cost-of-living crisis.
Without a skilled workforce to pluck the fruits of labour, a labour shortage can grind company operations to a halt. Keith Tully of Real Business Rescue (part of Begbies Traynor Group) runs through how to address the post-pandemic skills and labour shortage to protect the financial future of businesses and company cash flow.
The toll of Brexit and Covid-19 on skilled labour
The UK is currently at the peak of a skilled labour shortage, fuelled by global events that rocked the economy.
In the 12 months to June 2021 which marked the end of the Brexit transition period and the first Covid-19 lockdown, more than 190,000 EU nationals left the country, according to figures published by the Office for National Statistics. The year before this marked the exit of 260,000 EU nationals from the UK after the Brexit withdrawal agreement was finalised which overhauled rules around the freedom of movement of EU workers.
When the lockdown hit in March 2020, EU workers remained in their home countries as stringent cross-border travel rules were enforced. This deepened the labour shortage in the UK as the likes of bars and restaurants were forced to operate with a skeleton workforce or close until candidates became available, or existing employees were suitably upskilled.
According to the industry body for the hospitality sector, UK Hospitality, over 660,000 jobs have been lost over the pandemic and there are currently 400,000 open vacancies across the industry. The hospitality industry is amongst the hardest hit by the Covid-19 pandemic, along with the accommodation sector as they exhibit the largest increase in vacancies since before the pandemic.
In the UK, the number of job vacancies in Q2 2022 (April to June) was 1,294,000; an increase of 498,400 from before the coronavirus pandemic in Q1 2020 (January to March). This reinforces the severity of the labour shortage that UK businesses currently stand up against, which begs the question – how can a remedy be sought while the economy recovers from the pressures of Covid-19 and the aftermath of Brexit?
Reaffirming UK’s position as a global employer
The Food and Drink Federation (FDF), the membership body for food and drink manufacturers, published a report on labour availability issues in the UK Food and Drink Sector. The report addresses two practical routes through which businesses can aim to attract candidates to solve the labour shortage – enhanced recruitment and retention.
The strategy can be applied to any industry and aims to attract and retain candidates for the long-term through a combination of tactics that bolster the onboarding process and package a job offer that’s highly desired by potential candidates.
Enhanced recruitment – From increased wages and engaging with local educational institutions to sharing vacancies through a host of social media campaigns, enhancing the urgent call for job seekers can drive applications.
Enhanced retention – The challenge is to retain staff and minimise employee turnover to keep company operations well-oiled and the business operational. Retention methods include offering flexible working, additional annual leave, and a retention bonus for each milestone the employee progresses to.
Touching upon working style, the UK is also partaking in a four-day work week pilot at no loss in pay for employees to reaffirm the UK’s position as a competitive and lucrative place to work.
Download Our Latest Q2 HRTech Report
As the second quarter of 2022 draws to a close, technology continues to improve, modernize and innovate the HR Technology sector – the introduction of new products, services and software is becoming a daily occurrence across the globe to help improve access to online e-learning initiatives, streamline the recruitment process and enhance the employee experience.
In our latest HRTech report, we highlight 40 of the 52 M&A transactions within the HRTech sector which completed during the second quarter of 2022.
You can download the full report here.