The UK is currently in the grip of an “employment crisis”- there are 1.3 million job vacancies, and for the first time, there are not enough people looking for work to fill them. This is partly due to Brexit: it has “contributed to the exodus of 200,000 EU citizens” in the past two years; but a greater number of people – 450,000 – have simply left the workforce since 2019, and are now “economically inactive” (neither in work, nor looking for work).
When the ONS surveyed some of those who have left the jobs, almost half said they’d left their jobs of their own volition, and only two-fifths said they’d consider going back to work. The shrinking workforce is “the most urgent problem facing the UK economy”, said Chris Giles. In total, there are 900,000 fewer workers today than the Bank of England expected before Covid struck. Its governor, Andrew Bailey, has warned that labour shortages are driving up prices and wages (as employers feel obliged to concede to pay demands), thus contributing to his struggle to bring down inflation.
Most worrying is “that this is a UK-specific problem”. We have “the most persistent post-pandemic drop in employment of any G7 country”. And while some of it may not be the government’s fault, the fact that many of those who’ve left the work force are long-term sick is a black mark on its record, underlining the broader harm caused by the UK’s high levels of long Covid and record NHS waiting lists.
What is infuriating the industry is that the government is not doing more to tackle the issue, said Emily Sheffield. No improvement in the situation is likely in near future as there are no schemes to lure over-50s back to work. Now the only solution for the government is to ease the immigration policy so that more overseas workers can come and fill the shortage.
