Labour Shortage a Huge Drag on Economic Growth

Reacting to the latest ONS Labour Market figures, Jane Gratton, Head of People Policy at the BCC, said:

“Businesses are crying out for people to fill job vacancies at all skill levels, and this must be the number one focus for government if it’s serious about economic growth.

“There are still a huge number of vacancies, currently sitting at 1.134 million, and this is stopping firms in their tracks. It means they are struggling to meet the orders on their books, and it puts any plans for growth far out of reach.

“It is also ramping up pressure on wages, currently at the highest rates seen in the private sector outside of the pandemic. This has been identified by the Bank of England as a factor in its decisions to raise interest rates to tame inflation.

“Government plans to get the UK’s untapped labour force into employment are a step in the right direction, but we need to see more action to address the barriers that are holding people back.

“The Spring Budget represents a golden opportunity for the Chancellor to ease the pressure on family members who have been squeezed out of the labour market by childcare costs.

“Older workers need carefully tailored careers advice, job seeker support and rapid re-training opportunities to help bring their skills and experience back to the workforce.

“Businesses should play their part by adopting flexible working policies, wherever possible, and by supporting staff training needs.

“And crucially, Government should reform the Shortage Occupation List to help firms fill urgent job vacancies from outside the UK when they cannot recruit locally. The List should include jobs at all skills levels where there is clear evidence of a national shortage.”

More detail on the ONS Labour Market statistics can be found here.