One in three employers struggled with worker shortages at the end of 2022, many of which also saw their operations affected by strikes.
The results of the latest business insights and impact survey from the Office for National Statistics show that 32% of private sector organisations with 10 or more employees experienced a shortage of workers in December.
The health and social work sector saw the highest proportion of businesses affected, with 51% of respondents in this category citing worker shortages.
Asked how labour shortages had affected their operations, almost three in five organisations said employee working hours have had to increase and two in five had been unable to meet demands. A third have had to recruit temporary workers to cover duties.
Only 5% of firms experiencing worker shortages said they had seen no business impact.
Despite the shortage of workers in many industries, 5% of employers with 10 or more employees said they expected to make redundancies over the next three months. The most common reasons for doing so included cost reductions (69%) and certain job roles no longer being required (29%).
As waves of industrial action spread across the UK, around one in six (16%) of employers told the ONS that their business had been affected by strikes in November 2022. More than a quarter (28%) said they had been unable to obtain necessary goods for their business as a result.
The results of the survey tally with recent research from KPMG and the Recruitment and Employment Confederation, which said recruitment activity had slipped to its lowest level in 19 years as candidate supply continued to fall.
It has been suggested that employers should encourage over 50s who have left the workforce to return in order to fill skills gaps. However, another recent ONS report found that changes in lifestyle and caring responsibilities were preventing many older workers from seeking employment.
Kim Chaplain, associate director for work at the Centre for Ageing Better, said retaining more older workers for longer is central to solving the UK’s labour shortages.
“Of the more than 300,000 working-age adults who have left the labour market since the start of the Covid-19 pandemic, nine in ten are older workers aged 50-64. That is a huge loss of skills, knowledge, experience and expertise,” said Chaplain.
“It is clear that this issue is not going away by itself and we need concerted and targeted efforts from both government and employers to attract and retain more older workers in employment. We are slowly seeing a welcome change from employers who are now recognising that older workers provide an effective solution to their skills and labour shortages. High-profile businesses including McDonald’s, easyJet and Halfords have all stated their intention to recruit more older workers in recent months.
“Companies that can offer the right conditions for older workers with flexible working arrangements, easy access to employer support, and are able to remove ageist barriers from their workplace, recruitment processes and training will be the companies that benefit most from having a multigenerational workforce and will be best placed to overcome labour and skills shortages.”