CBI @10am: Unpacking labour market shortages

Speakers:

• Matthew Fell, Chief Policy Director, CBI
• Gaelle Blake, Head of Permanent Appointments, Hays
• Andrew Brodie, People and Communications Director, Avara Foods
• Liz Moseley, Editor and Partner, Tortoise Media (chair)

In this session:

Matthew Fell (CBI)

On Covid:

• Busy autumn ahead with the easing of restrictions and entering phase of living with the virus. CBI set up some principles around this over the summer including importance of using mass testing to prevent mass isolation, utilising covid secure tools, and maximising our world-leading vaccine programme.
• Also, there’s a back to term week feel for most firms who are office based and we’ve seen quite a few cities are busier. In London, TfL reported traffic on Monday was busiest for 18 months.
• Continuing our work on effective hybrid working and are keen to make sure we're learning as we go and adapt to get this right for businesses. Look out for further guidance from the CBI this autumn.

On labour market shortages:

• Hitting lots of businesses, not just isolated in 1-2 sectors. Biting right across economy at all skills levels: chefs, welders, carpenters.
• Spoken to hotel owners who are artificially limiting occupation rates, restaurants opening at either lunch or evenings as not enough staff.
• 2-year rather than 2-month endeavour. End of furlough may help but probably not going to be a perfect skills matchup
• The focus on training is part of the answer but takes time. Also need to make training a bit easier - flexible apprenticeship levy to target funding.
• This is alongside shorter-term interventions such as adding new occupations to the Shortage Occupation List.

Andrew Brodie (Avara Foods)

• Usually employ just over 7,000 people but currently have 800 vacancies which is heavily impacting on operational capabilities in factories and as a result - customers.
• Also seeing pinch points in key skills across industry and struggling with additional uplifts in resource they usually need for seasonal BBQ lines as well as turkeys into Christmas.
• 'Canary in the mine' as they are impacted first in the supply chain.
• The speed of the shortages has caught us by surprise - fine in February and March but then, around Easter, saw a trend of European colleagues returning home and then found it difficult to replace given immigration restrictions and local labour supply.
• People are leaving labour market – so the pool is shrinking.
• Difficulty given they have big operations in rural settings – which they can't move. Therefore, not as simple as 'moving to where the unemployment is' – this is a long-term structural change we need to get our heads round.
• Back in the summer Avara Food tried attraction and retention bonuses, put on more transport but with limited success.
• Looking at growth investment and innovation in tech but this takes a long time – but do have a business plan to deliver it.
• Have been really clear to government - if gov want higher skilled higher tech economy it takes time, short term we need gov to allow us to utilise tools they've already put in place e.g., butchers and other primary workers on SOL, meat sector on existing schemes for horticulture, skills development via a more flexible apprenticeship levy and more representation in lifetime skills list.
• Key takeaways: this will not be over by Christmas and will likely also wash through into those in higher skills and pay. What you've done to recruit and retain staff for last 5 years won't work for next 5 years.

Gaelle Blake (Hays) 

• Firms are struggling to find people across every sector they work with - both horizontally and vertically e.g., onsite workers and accountants. Have never seen recruitment this busy.
• Shortages are steep as the economy bounced back and demand picked up quickly.
• While some people are seeking new roles having stayed put for 18 months, Hays are seeing that it’s the businesses who are having to actively seek out employees rather than candidates going to employers/recruiters. Good news is that candidates are more confident and willing to move roles than they were during the height of the pandemic.
• To attract candidates, businesses need to tailor their approach individuals and their career and try going to a recruiter who may have existing pool of candidates. Also, need to be clear about their brand proposition is e.g., what makes you different to other companies? and ensuring you’re telling candidates what you can offer.
• For example, if you’re in a sector where most of your competitors are offering hybrid working, you’ll struggle to fill roles if you don’t. In addition, hybrid working could help you reach more diverse candidates and widen the talent pool you’re tapping into. This is more appropriate for some sectors than others, however.