UK firms struggling to recruit nears all-time high

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The job market in the UK has never been tighter. Photo: Getty

New data released on Thursday has shown that the proportion of UK firms struggling to recruit workers is climbing "precipitously", with 77% of those attempting to recruit reporting difficulties.

According to the British Chambers of Commerce (BCC) recruitment outlook for the second quarter, 61% of firms overall attempted to recruit in Q2, highest since the second quarter of 2018.

The data came from a survey of more than 5,600 firms.

The proportion of those reporting recruitment difficulties saw a seven-point rise on Q2, a fact most pronounced in the hospitality sector.

Of firms in the hotels and catering sector, 92% reported difficulties, while 75% of service sector firms said likewise, both the highest response rates on record for the dataset going back to 1997.

Among manufacturers 80% reported recruitment issues (71% in Q2), the highest proportion since 2018 and only one percentage point away from the all-time high for this indicator.

Consumer services firms (such as tradespeople, cleaning, and education) were the least likely to report difficulties at 69% but even this represents an eight-point rise from 61% in Q2.

“Right now, we need Government help to provide a more flexible skills system, rapid retraining opportunities and targeted immigration initiatives to plug skills and labour gaps," said Jane Gratton, head of people policy at the BCC. "Wage pressures and energy prices are also ramping up the cumulative costs and there is a limit to how much more can be absorbed, before firms are forced out of business."

Looking at the types of roles firms were facing difficulties for, of all respondents, 50% reported difficulties in hiring skilled technical staff, 45% managerial roles and 34% unskilled or semi-skilled workers.

Adrian Hanrahan, managing director of Robinson Brothers, a chemical manufacturing company employing 260 people said he had "never had anything like it before". The firm is currently trying to recruit for 20 vacancies.

"What we are struggling with is getting people in full-time posts, and this has been going on for some time.

“It includes everything from engineering and maintenance to research, customer services and production operators. It is skilled and non-skilled roles."

Read more: UK jobs and payrolls hit record highs as staff shortages continue

Hanrahan said the firm has had issues despite raising its salaries.

“Pre-Brexit and pre-Covid we always had one or two vacancies, but this current scale is unprecedented. Everyone is looking for people.

The BCC's data comes following ONS data that showed the number of job vacancies reached 20-year highs between July and the end of last month.

Figures released on Tuesday showed that the unemployment rate had also fallen for the eighth month in a row.

Analysts said recent data has provided early indications that the withdrawal of furlough at the end of September may not have sparked a rash of redundancies as feared.

The Insolvency Service found recently that just 200 companies planned to make more than 20 people redundant between September-November, which would put just 13,836 jobs at risk.

“If action is not taken to address the mounting problems revealed by these data, then businesses will also face extreme difficulty in meeting demand and consumers will see further reductions in the goods and services available to them as we progress into winter,” said Gratton.

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