South West firms struggling to recruit as skills shortage holds back Covid recovery

The recovery of businesses in the South West from the economic impact of the pandemic is being held back by skills shortages and recruitment difficulties, according to a new survey.

British Chambers of Commerce South West (BCCSW) has warned that its members across different sectors are struggling to recruit at all levels.

Despite a rebound in business confidence, the BCCSW’s latest quarterly economic survey found that activity and cashflow are at historically low levels:

  • Two-thirds of firms recruiting for highly skilled manual and technical roles are experiencing difficulties finding the right staff;
  • Over half of services-based firms are struggling to hire professional and managerial personnel;
  • Almost a third of businesses are having difficulties filling semi or unskilled positions.

The BCCSW has called on the government to help provide “real solutions” to current and long-term shortages of talent it says businesses need to grow out of the economic downturn.

It has suggested recruitment for lower skilled or seasonal roles across the South West could be helped by improving the operational delivery of the government’s ‘Kickstart’ programme, and reviewing the earning threshold in the visa system to encourage more workers from overseas to provide skills in the near term.

It added that businesses wanted to see the establishment of a “comprehensive and mature” plan to upskill South West communities to adapt to the long-term employment needs of the regional economy.

Phil Smith of the BCCSW said: “The sudden resurgence of business activity has meant that businesses who need to recruit are confronted by a tight labour market, especially for skilled staff.

“The double impact of Brexit and Covid-19 has had major impacts on the location and availability of the workforce in the South West, with a falling but still significant proportion of our residents on either furlough or Universal Credit.

“We cannot let the talent and potential of our communities go to waste, or for that matter put at risk our economic recovery, due to tricky but ultimately solvable labour market challenges.”

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Somerset-based desserts manufacturer Marston Foods said recruitment difficulties were pushing up prices across the entire supply chain and urgent short-term action was needed to allow more skilled workers into the UK.

Leona McDonald, Marston Foods’ commercial director, warned that suppliers could not “keep being squeezed and still survive”, adding that if nothing was done to address the skills shortage consumers would see prices go up.

Ms McDonald said: “It takes time and money to train people to the standards that we require, and so once we have people we like to keep them, but we have lost a lot of our loyal European workforce and there seems to be very few local people to train.

“We live in a disparately populated area, with low unemployment and a rather lapse public transport system. There are applicants, but due to the remit with regards to benefit claims, a majority never take the application process any further and so we waste time chasing and calling to no avail.

“Offering higher pay and other benefits – which we are doing – is only part of the solution to a much wider issue.”

Another Somerset food manufacturer, the cheesemaker Norseland, recently said that Brexit had contributed to a labour shortage at its Ilchester factory, after many of its workers from European Union countries decided to leave the country.

A Government spokesperson said: “Our new points-based immigration system makes clear that employers should focus on investing in our domestic workforce, especially those needing to find new employment, rather than relying on labour from abroad.

“Immigration must be considered alongside investment in, and development of, the UK’s domestic labour force, rather than as an alternative to it. This is especially relevant in light of the many UK workers who face an uncertain future given the economic impacts of the pandemic.

“We’ve implemented an unprecedented package of measures to support businesses during the pandemic and our Plan for Jobs is helping people across the country retrain, build new skills and get back into work.”

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