Tag: labour shortages

Only one-third likely to have a break before Christmas

One in three UK office workers will not be able to take any annual leave between now and Christmas due to staff shortages, according to The Annual Leave Allowances survey from Just Eat for Business.

In the survey, UK employees were asked how and when they utilise their annual leave, whether they are encouraged to take breaks, and how time off impacts their work/life balance.

Annual leave is essential for rest, relaxation, and re-energisation, but the survey results revealed that many workers are forced to ‘burn the candle at both ends’ due to understaffing.

According to findings, 21% of office workers regularly or always have their time off requests denied due to staff absences, and 16% repeatedly have their annual leave requests rejected to accommodate workloads. In addition, the research showed that one in three people are set to have their annual leave continually rejected between now and Christmas due to a lack of resources, thereby further depleting their work/life balance.

The trend is unlikely to change for the rest of the year, with many workers with children working hard to make up for drops in productivity over the summer holidays and ahead of the October half term.

A recent report listed labour shortages as the ‘most urgent problem’ facing the UK economy. Over a third of UK businesses regularly have to turn down work due to staff shortages, and this is projected to continue for the next two years.

The survey revealed that even when employees can get time away from the office, 25% cannot avoid working while on holiday, as they’re likely to be contacted to help deal with absences or work queries.

The lack of annual leave has also resulted in 16% of employees using their allowance to cover medical appointments.

The mental health implications are also great, with 44% of employees feeling burnt out at work, with a third finding that maintaining a healthy work-life balance is the most stressful aspect of work.

Will Foster, Professor of Leadership at Keele University, commented: “It’s essential that if the ‘espoused’ values of the organisation include employee wellbeing and restorative breaks, then leaders need to prioritise that. “

“Management must do the hard work of ensuring the structures, roles, responsibilities and staffing levels align so employees can take a ‘true rest’ when needed, regardless of the time of year and understaffing issues.”

Anni Townend, Leadership Partner, added: “Annual leave is an important part of a much bigger picture of looking after our life-work balance and of creating a positive work culture, particularly throughout the festive period.”

“The danger of not taking annual leave is that we lose our ability to switch-off and to disconnect from work. This can impact our sleep patterns and our ability to concentrate, as well as cause extreme mood swings and a weakened immune system.”

Rosie Hyam, People Partner at Just Eat, also commented: “Given the emphasis on employee well being and work-life balance over the last few years, it’s essential that employers are receptive to flexible working arrangements, and that they allow employees to take time away from work when needed.”

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The rise in job ads speaks to increased strength in the labour market

According to data from ANZ Bank, job advertisements in Australia rose by 18.4% in June 2022 on a seasonally adjusted basis when compared to the same period in June 2021. This pattern of online job postings is being seen across the globe as skills shortages continue.

On a monthly basis, job ads increased 1.4% in June following a small upward revision of the May number. The total number of job ads in June exceeded the recent peak in March signalling continued strength in the labour market.

When compared to January 2020, job ads were up 58.9% while the number of job ads totalled 243,523 in June 2022.

Catherine Birch, ANZ Senior Economist commented: “Growth in demand for labour is still outpacing supply but the sheer volume of unmet labour demand suggests underutilisation will keep falling and stay low even as demand growth is curtailed by higher inflation and rising interest rates. The very tight labour market is a key reason why we expect the Australian economy will be resilient in the face of these.”

The Bank’s job ads data is based on information provided by the operators of Seek.com.au and the Department of Education, Skills and Employment’s Australian JobSearch site (Jobsearch.gov.au).

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More disabled people than non-disabled people research pay gaps before applying for jobs
According to the ONS’s disability pay gap report, the pay gap has widened since the 2014’s number of 11.7%. In 2019, the pay gap was 14.1% and shrunk slightly in 2021 to 13.8%.

UK careers site, Reed.co.uk’s research has also found that 66% of disabled people research gender pay gaps, whereas only 21% non-disabled people did the research. This is an indicator of how important pay parity is for minority groups. The study also revealed that one-in-ten surveyed respondents don’t think that any pay gaps exist in the UK.

Simon Wingate, Managing Director of Reed.co.uk, commented: “It is disappointing to see that the disability pay gap has widened since 2014. This widening discrepancy between disabled and non-disabled workers is especially concerning given that the rising cost-of-living crisis is putting pressure on people across all of society.”

“It’s also concerning for employers facing challenges of their own in terms of recruitment amid widespread labour shortages. Tackling the disability pay gap will be crucial to widening the talent pool, as our own research highlights how important pay parity is to minority groups. Two-thirds (66%) of disabled people state they research a company’s gender pay gap before applying for a job, compared to 21% of people without a disability. This sentiment, in conjunction with the newly released ONS report, demonstrates the attention and work that still needs to be implemented to ensure employers close their disability pay gap.”

“As a Disability Confident employer, Reed.co.uk recognises how important it is to support employees who disclose that they have a disability and will always seek to make reasonable adjustments for prospective candidates. Every individual’s needs will inevitably vary, and it’s important that employers understand this and make appropriate adjustments to support suitable candidates who have applied for a job with them. A fundamental way to attract prospective disabled workers is by being clear in job adverts that the organisation is an inclusive employer who values diversity and is willing to make reasonable adjustments to support candidates through the recruitment process and beyond. It is also helpful to be fully transparent about pay, flexibility, and benefits on job adverts as this will help employers attract a more diverse range of applicants to their role, and ultimately their business.”

As previously reported in TALiNT International, flexible working could create jobs for more than a million disabled candidates. Employers should be creating equal opportunities for every candidate in the workplace and not only promote equal pay, but also offer flexibility as a matter of course.

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ONS stats show increase in economic inactivity

The latest figures from the ONS have been released and what stands out is that even though average pay rises for the first quarter are at an average of 4% (excluding bonuses), this appears well below inflation. However, in real terms (adjusted for inflation), growth in total pay was 0.4% and regular pay fell on the year at negative 1.0%. Strong bonus payments over the past six months have kept recent real total pay growth positive but employers may find it even harder to retain talent through salary increases alone as the cost-of-living crisis continues in the UK.

The latest Labour Force Survey (LFS) showed that for December 2021 to February 2022 the employment rate remains unchanged on the quarter, while the unemployment rate decreased. Over the same period, the economic inactivity rate has increased slightly which signals a slight dip in the economic rebound following the end of the pandemic with inactivity increasing by 0.2 percentage points to 21.4% from December to February 2022.

There was a noteworthy increase, albeit small, in the number of payrolled employees for March 2022 which is up 35,000 on the revised February 2022 to a record 29.6 million.

The report showed that once again, the number of job vacancies in January to March 2022 rose to a new record of 1,288,000, with the rate of growth in vacancies continuing to slow down.

Jon Keeble, employment partner at DWF commented on the latest report: “The latest ONS labour market figures demonstrate continued resilience in the labour market. The highlights for the period between December 2021 and February 2022 show a largely unchanged employment rate of 75.5%.

“With legal requirements largely removed across the UK and a shift over to personal responsibility we are very much in the phase of having to live with COVID-19. Although employers are now faced with a number of practical challenges as we enter this next chapter, the relaxation of restrictions should have a positive effect on the labour market.

“We are yet to see what impact the cost-of-living crisis will have on the labour market and whether the Chancellor’s Spring Statement and the rise in the National Minimum Wage will provide sufficient support.  Undoubtedly, employees who are struggling to cope financially will be seeking out those employers, which are able to provide the most attractive rewards package.”

James Reed, Chairman of Reed.co.uk, also commented: “The economy is facing a crunch point as businesses contend with serious challenges, from rapidly rising inflation to severe labour shortages. The jobs boom that began last year continues to be reflected in the ONS’s labour market statistics. With job postings on Reed.co.uk in March increasing 18% year-on-year and 14% month-on-month, this trend shows little sign of slowing. But with economic growth now as low as 0.1% and unemployment at historic lows, the jobs boom is in danger of becoming a jobs overload.”

“The difficulties businesses now face in hiring staff, are having a knock-on effect on supply chains, production output and the quality of goods and services. This is slowing the UK’s economic recovery from the pandemic.

“There are now 8.8 million people who are economically inactive in the UK, which is 600,000 more than at the start of the pandemic. This is a symptom of what I call ‘The Great Lie Down’, with many workers leaving the workforce altogether, some through long term sickness and others preferring early retirement or different lifestyle choices. If these workers are to be coaxed back, they will need convincing with attractive employment arrangements, higher wages and better conditions and benefits.

“Currently, less than 20% of these people who are economically inactive say they would like a regular, paid job. However, if it was possible to help this group find work then that would be of great benefit to both them and the economy.”

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Starting salaries show a record rise

According to the latest KPMG and REC, UK Report on Jobs survey, candidate shortages have slowed down hiring in both permanent and temporary recruitment. Even though expansions are high based on previous records, the increase rates hit 11- and 12-month lows, respectively.

The report, compiled by S&P Global, is based on responses to questionnaires from around 400 UK recruitment and employee consultancies.

The survey found that overall staff supply had the steepest drop in four months. Those surveyed attributed the candidate shortages to the low unemployment rate and uncertainty related to the pandemic and the war in Ukraine. Other reasons included fewer EU workers and robust demand for staff.

The candidate shortage has led to significant increases in starting salaries – the salaries for new permanent employees rose at the quickest rate in 24 and a half years. In addition, the average wages for temporary workers also increased at the fastest pace in three months.

Although all UK regions showed increases, there were variations in the various English regions. The Midlands showed the steepest increase in permanent placements, while the lowest increase was in the South of England.

Further variations were noted between the private and public sectors, with the largest expansion in demand being in the private sector.

The IT and computing industry continues to show the steepest increase in demand. Conversely, the softest increase was in the retail sector.

Neil Carberry, Chief Executive of the REC, commented: “We can clearly see that labour and skills shortages are driving inflation in these latest figures. Starting salaries for permanent staff are growing at a new record pace, partially due to demand for staff accelerating and partially as firms increase pay for all staff in the face of rising prices. Record COVID infection levels are also pushing up demand for temporary workers, particularly in blue collar and hospitality sectors, underpinning the ability of temps to seek higher rates.

“However, the overall number of placements being made is starting to stabilise. This is no surprise after a period of historically high growth, and in the face of more economic uncertainty. Even so, the jobs market is very tight. Businesses will need to broaden their searches and be creative in making their offer to candidates more attractive, in consultation with recruitment experts. But government can help by incentivising investment in skills and people during the inflation crisis.”

Claire Warnes, Head of Education, Skills and Productivity at KPMG UK, said: “There’s no end in sight to the deep-seated workforce challenges facing the UK economy. Once again this month, job vacancies are increasing while there are simply not enough candidates in all sectors to fill them. With fewer EU workers, the ongoing effects of the pandemic, the economic impacts of the war in Ukraine and cost of living pressures, many employers will continue to struggle to hire the talent and access the skills they need. With unemployment staying low, there are many great opportunities for job-seekers to join or rejoin the workforce in all sectors.”

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Employers rigid in hiring criteria despite skills gap 

Over half of employers (60%) are receiving more applications from candidates who have come from different industries new research by Reed.co.uk has revealed.  

The commissioned researched canvased over 250 hiring decision-makers across the UK and reflected an increasing awareness of transferable skills with an appetite for reskilling among jobseekers. The news comes after Reed.co.uk reported 140,000 courses were purchased in the first half of November – a 786% rise year-on-year – as workers reevaluate their skillset in light of the pandemic.  

Some employers remain rigid in their requirements of applicants, despite this wider range of talent that has become available to businesses with over half (60%) of hiring decision-makers still feeling it is important for applicants to have a university education, which immediately limits the size of their candidate pool.  

Hiring managers within the Construction and Technology sectors – who report more labour shortages than those from any other industries in the survey – are also the most likely to believe a university education is important for candidates. Whereas employers in ‘real estate’ (17%) and ‘creative industries’ (33%) placed the least importance on applicants having a university education. 

Alongside a university education, the research showed that employers add much value to soft skills, such as teamwork and interpersonal skills, as a result of the shift to remote working with two-thirds (64%) of hiring decision-makers in agreement. 

While a university education and soft skills are desirable for a candidate, some employers may need to become more flexible about their expectations, especially as over half (55%) of the businesses surveyed reporting labour shortages.  

Simon Wingate, Managing Director of Reed.co.uk, commented on the findings: “It’s encouraging to see that many workers are already learning new skills to improve their career opportunities. However, employers should be more flexible when it comes to hiring, by looking at workers who haven’t got qualifications but who are willing to learn and have useful transferable skills for a modern working environment. By sticking to a rigid, old-fashioned approach to recruiting, you could be discarding talent that could help fuel your growth plans in 2022.” 

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Recruiters report difficulty in sourcing candidates

A survey conducted by the Recruitment & Employment Confederation (REC) reported that nine in ten recruiters (88%) say that labour shortages are one of their biggest concerns for the remainder of 2021, while skills shortages are a major concern for two in three (65%).

With shortages hitting every sector of the economy and many staffing companies reporting the tightest labour market they’ve ever experienced, the REC is calling on business and the government to take urgent action to solve the problem.

Recruiters have a significantly higher number of roles to fill than before the pandemic, with three in five (58%) having at least 30% more vacancies than pre-pandemic. Of the 191 recruiters surveyed, almost all (97%) said that it was taking longer than usual to fill those vacancies, compounding the problem. Half (50%) reported that it now takes more than a month to find suitable candidates.

Recruiters reported several factors were affecting their ability to source candidates. The top reason was skills shortages (cited by 65% of respondents), followed by the new immigration rules (57%) and their clients not being able to offer competitive salaries (53%).

In response, the REC has set out a number of asks for both government and business to help solve this crisis:

  • Set up a cross-government forum including the Business, Education and Work and Pensions departments, as well as business organisations. This would restore the importance of workforce planning in the economic debate between business, government and other stakeholders, not only focusing on skills.
  • Broaden the apprenticeship levy and increase funding for training at lower skill levels. This would improve progression and transition opportunities for lower-skilled and temporary workers who need them most, and encourage business to do more here in the UK, not less.
  • Allow flexibility in the point-based immigration system and a visa route for lower-skilled workers, which would allow firms in the worst-affected sectors like logistics to access staff at times of pressing need.
  • Increased focus from businesses on workforce planning, staff engagement, attraction and retention policies. Firms need to raise workforce planning up to the senior leadership level, and work with key professional partners like recruiters to boost performance, productivity and staff wellbeing.

This also follows recent research from British Future, which found increasingly positive public attitudes towards immigration. Two thirds of the public (65%) agree that employers should be allowed to recruit from overseas for roles in shortage – showing that a more flexible immigration system would be popular as well as helping businesses to fill crucial vacancies.

Kate Shoesmith, Deputy CEO of the REC, said:

“Worker shortages are a huge problem for employers and their recruitment partners, across all industries and regions. Vacancy numbers are far higher than pre-pandemic, and it is taking much longer to fill them. This is putting the recovery at risk by putting capacity constraints on the economy, as last week’s GDP figures showed. In our survey, recruiters also highlighted a wide range of factors that have combined to cause these shortages – this is a complex problem with no one easy fix.

“As such, we will only solve these shortages through a collaborative approach. We’re glad that multiple government departments are coming together in a joint forum to tackle the issue, but to be effective it must also include business and industry experts. Government must allow more flexibility in the immigration system so firms can hire essential workers like drivers from abroad, and also improve training opportunities for lower-paid and temporary workers. Meanwhile companies need to focus on how they will attract and retain staff through improved conditions and facilities, not just pay.”

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