The latest version of the UK’s largest private sector business survey shows that skills shortages are reaching critical levels.
Published by the British Chambers of Commerce (BCC), the Quarterly Economic Survey covers the last quarter (Q4) of 2017 and is based on responses from over 7000 businesses.
It reveals that growth and confidence remain subdued, with almost all services indicators below their pre-EU referendum levels and manufacturers’ performance fading slightly over the quarter.
One of the key findings of the survey was the extent to which companies are struggling to recruit suitable staff.
During Q4, the percentage of manufacturers that attempted to recruit fell from 71% to 66% – of which 75% reported recruitment difficulties. The main problem was in finding skilled manual labour – an issue cited by 68% of respondents and which the BCC says is the highest recorded since records began.
The service sector saw a slight fall in the percentage of firms trying to recruit (down from 52% to 50%) with 71% of those reporting problems finding people. That figure is also the highest recorded.
“Labour and skills shortages are set to be the biggest potential drag anchor on business in 2018,” BCC Director General Dr Adam Marshall said.
Businesses themselves must do more, he added, by training and investing wherever possible in people, but the Government must also give firms the confidence to put their livelihoods on the line and go for growth.
Among other findings, the balance of manufacturing firms reporting increased export sales fell from +29 to +25 (the lowest reading since Q4 2016) while export orders were down from +24 to +20.
For domestic sales, the balance fell from +24 to +23 while for domestic orders it dropped from +21 to +18.