Monday, February 13, 2023 4:23 PM
London’s economy is crippled by a chronic labor shortage which Chancellor Jeremy Hunt is due to tackle in the March 15 budget, a new report from leading business lobby groups has pointed out today British.
Almost two in three businesses in the capital are struggling to fill vacancies, according to research by BusinessLDN, the Federation of Small Businesses, the Confederation of British Industry and the London Chambers of Commerce and Industry.
The report says the capital’s economy risks missing an opportunity to keep unemployment low as the UK slides into a recession.
Some 77% of companies are trying to hire staff, but today’s research suggests that many of these positions will go unfilled.
The alliance of lobby groups produced the research to illustrate the scale of the labor shortage London businesses are grappling with to urge the Chancellor to release funds to boost the jobs market during of the March 15 budget.
The UK labor market has been extremely tight since the country emerged from Covid-19 lockdown measures, mainly due to the departure of more than 500,000 people from the labor force.
The unemployment rate in the UK is at its lowest in several decades and the ratio of vacancies to unemployed is at historic highs.
However, the existing skills among available workers do not meet the needs of companies.
More than half of the more than 1,000 companies surveyed by Survation for the collective believe that their biggest obstacle to recruitment “is a low number of suitable candidates with the required skills”.
“Skills shortages not only hold back business growth and affect employment, but also have long-term implications for the future of our young professionals,” said Richard Burge, chief executive of the Chamber of Commerce and Industry. London Industry (LCCI).
“In an environment where demand exceeds supply, skilled workers are the backbone of our fragile economy,” he added.
Companies are responding to difficulties in finding suitable new recruits by developing development plans for their existing staff. Some 69 percent plan to strengthen training.
The CBI, LCCI, Business LDN and FSB are leading the Greater London Government-backed Local Skills Upgrading Scheme, which aims to ensure training is better aligned with business needs.
The Treasury has been contacted for comments.