Traditionally, when we head into a period of recession, unemployment begins to rise sharply and there’s a growing clamour among a swelling pool of workers to find jobs.
But these aren’t usual times, and despite the economic omens for 2023 looking decidedly shaky, the labour market in Shropshire remains incredibly tight.
So why is this, what are the implications for the economy, and what can we do about it?
It was a key topic of a panel debate on Shropshire Business Live TV, broadcast in front of an audience in the theatre at Prestfelde School in Shrewsbury.
Shropshire Chamber chief executive Richard Sheehan was joined by Graham Guest, principal of Telford College and skills champion at the Marches LEP, and Hollie Whittles from the Federation of Small Businesses.
The first question for the trio was: why are businesses across the majority of sectors in Shropshire finding it so hard to recruit staff at the moment?
Richard said: “The pandemic has definitely changed people’s relationship with the workplace in many cases.
“We’ve seen many examples of companies struggling to fill vacancies because they can’t accommodate a work from home environment, which has become much more important to many people.”
Migrant labour issues were also having an impact, he said, with Shropshire having such a reliance on sectors such as agriculture, tourism, leisure and hospitality, which traditionally rely on access to overseas staff.
Firms now have to be proactive to persuade staff to commit to a new job. “It’s taken businesses a long time to realise that, actually, they have to sell themselves now because it is such a tight labour market.”
Research from many sources, including Shropshire Chamber and the FSB, agree that around three quarters of businesses with current vacancies are struggling to recruit.
Richard added: “The ‘working from home’ factor is something which has become a lot more important to a lot more people.
“It’s almost a reversal of the past. We are in a situation now where no longer do people apply for a job and it’s just about them having to sell themselves – businesses have to do the same.
“The pandemic has changed people’s whole attitude towards work and the workplace.
“The migrant labour issue has affected us here in Shropshire too, especially with the sectors we have such as those surrounding agriculture, tourism, leisure and hospitality.
“They have been hit really hard by the loss of that labour, there’s no question, and we have been flagging that up for more than a year, and progress needs to happen.”
Hollie Whittles, who runs Purple Frog Systems in Telford and is a national skills champion for the FSB, said: “We have an ageing population in the Marches. We are a rural area and businesses are being hit by all manner of rising costs, so recruitment on top of that is a massive problem.
“We have a never-before-seen situation where the number of job vacancies is higher than the number of people unemployed or looking to change career.
“The pandemic led to new work practices and flexibilities, which many people are reluctant to leave behind. Many of those who are looking for work are holding out for much higher pay and much more flexible working arrangements.
“Many workers in traditionally lower pay, high-stress industries, have decided to change career altogether, creating even greater shortages in areas such as care, hospitality and retail.
“They are issues which would pose challenges to anyone looking to recruit new staff. With them all coming into play at the same time, the situation is becoming critical. I recently heard from Shropshire SMEs who have turned work away because they lack staff capacity to take anything else on. Others have run recruitment campaigns and had no applicants come forward.
“Some, principally in the IT sector, have had staff poached by larger corporate enterprises and then struggled to back fill the vacancies.”
Moving forward, the panel agreed a strong relationship between businesses and education was vital to promote opportunities and careers.
“We found in our survey that only 17% of businesses are engaging with schools and colleges,” Hollie said.
“Sometimes, instead of leaving it to the big businesses, we need to encourage smaller businesses to speak up and communicate.”
Graham Guest added: “I think what we are beginning to see, for the first time in 30-odd years in education, is some businesses – those that can – having the capacity to think further ahead.
“We are talking to businesses who are telling us they need to now project five years. They are asking if we can work with the schools to create a pipeline taking people through school, college and university, and I think that is really positive.
“With work experience, apprenticeships and more, there is a plethora of opportunities for employers to get involved.
“For many employers, they need that person right now, not some time further down the line. But there are lots of initiatives going on now that see education and business coming even closer together to meet this challenge.”
One of the projects is the Local Skills Improvement Plan, funded by the Department for Education and led locally by Shropshire Chamber, which aims to put the voice of employers at the heart of the learning and skills system to build stronger partnerships with further education providers.
But should employers be looking within their own walls, at their own policies, to help solve the recruitment crisis?
While some factors around staff turnover may be inevitable, such as retirement, a change in career, or even moving away, others can be controlled.
Employee wellbeing experts Loopin have highlighted six major factors they feel could lead to a high staff turnover – from lack of opportunities and purpose, to overworked employees, all of which contribute to huge employee turnover costs.
Not providing any opportunities for employees to progress can cause them to feel stuck in their roles and feel as though their hard work and commitment aren’t recognised. A different company that can offer a role of higher authority will eventually become more appealing after plenty of time in the same role – not only for income but to further demonstrate their skills. Offering promotions for existing employees rather than hiring externally is one way to provide opportunities for growth. Communication is key in this instance to ensure that staff have clarity on how they need to perform in order for this to be possible, for example, a checklist of targets over a realistic time frame – this way, both you and the employees can assess how close they are to the next step. Alternatively, providing relevant training courses for staff allows them to educate themselves and stay up to date with the sector, thus being an excellent opportunity for growth.
Offering feedback to employees is a small implementation that can go far – not only does it show recognition, but it’s also a huge factor that can help them succeed. Regular one-to-one sessions are an excellent opportunity to provide feedback, as they give employees the chance to address any areas they are particularly struggling in. As an employer, the purpose is not to provide top-down performance feedback, assess the company’s performance, or evaluate the status of certain projects. Instead, the employee needs to take centre stage. You should ask questions to discover more about their goals and ambitions, as well as any concerns or pain points.
Micromanagement can have huge implications that can drive employees away. Not only does it limit creativity, but it also implies that you don’t trust employees to make the right decisions on their own. Micromanagement can also lead to burnout, which not only affects productivity and company success, but the employee will likely consider joining a company that offers a more supportive approach to management. Although it can be daunting to let go of projects, delegating to your team members will allow employees to feel valued, trusted and therefore, confident to complete the task. Seeing your employees complete these tasks will help you to see their skills first-hand and allow for timely feedback. Managing expectations instead of tasks is essential to zone out of the micromanagement phase and offer more freedom to employees. Therefore, ensure that before the task is given to a team member, you have made clear your thoughts and goals on the task at hand. This enhances communication between yourself and the employee and allows them to have clear structure before you trust them with the task.
Flexible working options offer a practical solution for employees. It can help those using unreliable public transport, those who need to take their children to school, or those with pets, to name a few. Implementing flexible working options where employees can be more autonomous and set their own schedules offers a healthier work-life balance; without it, employees may turn to a different company that does provide this benefit. To incorporate flexible working into the organisation, you can start by selecting the core working hours in which every employee must be present – but outside of this, employees can decide when they start and finish. On top of this, switching to a hybrid workplace where employees split their time between the workplace and working remotely can increase productivity and allows them to use their time more efficiently – not to mention, it’s an attractive factor to job-seekers.
Of course, there may be times when employees will have additional responsibilities. Particularly whilst many companies are making significant redundancies, resulting in employees having a bigger workload. However, managers must monitor the workload of all employees and find ways to protect them from burnout and stress caused by unavoidable workloads. Without doing so, staff are more likely to search for another role that offers a better work-life balance. On the other hand, employees must have enough work and understand their contribution to the make-up of the organisation’s overall mission, vision, and success. This is another area where regular one-to-one sessions are particularly useful. You can use this time to ask questions of your employee about how they are finding the workload and alter it based on their answers. Additionally, a preventative employee wellbeing strategy is key to understand how employees are feeling. It’s crucial to offer early support to employees who are feeling stressed, burnt out, or disengaged, which could be related to their workload.
Free lunches and table football are great, but they barely scratch the surface when it comes to creating a culture where employees feel appreciated, cared for, and understood. If employees feel their work is not valued and their contributions go unnoticed, they are likely to lack motivation and may consider leaving their current role for a job that is more rewarding and enjoyable. Understanding an employee’s concerns, values, needs, and hopes for the future is crucial to retain your top talent. Efforts should be made to communicate and understand individuals’ needs and inspirations, so their hard work can be recognised in a way that has the maximum impact.
The results of the latest quarterly economic survey, carried out by Shropshire Chamber for the final three months of this year, make for interesting reading from a skills, recruitment and training perspective.
It says: “Staffing issues still dominate. Employers are struggling to find staff and when they do, many turn out to lack competency, despite qualifications.
“Many employers are saying they cannot compete with city wages, or struggling to attract staff to rural area jobs due to transport costs – or lack of transport.”
One respondent from the service sector said: “There is a lack of response to our adverts and CVs are received with no experience at all.”
Another from the manufacturing sector added: “Some have even accepted job offers, then have not turned up for work.”
The survey showed that around 80% of companies had tried to offer higher wages in a bid to fill vacancies, while around two thirds said they were seeing fewer older or skilled and experienced candidates coming forward when recruiting.
Nearly a third of those surveyed said they now allowed staff to move to flexi hours, or be home-based, and more than one in five reported a need to use subcontractors to help plug recruitment gaps.
More than 20% of respondents said they were also now allowing older staff to take the option of shorter or more flexible hours to fit in with their changing circumstances – and to avoid losing their skills and expertise from the business altogether.
Quite possibly driven by the skills shortage and challenge in recruiting new staff, the Shropshire Chamber survey also saw an uplift in the final quarter of the year in the number of employers seeking to invest in training.
The figure rose to 33%, from 25% in the previous quarter, with one respondent saying: “The key is to invest back into the business and motivate staff through training and career progression – and ultimately money.”
There’s another trend sweeping through the workplace which is causing a headache for employers too – the Americans have christened it ‘quiet quitting’.
The concept doesn’t involve actually leaving a job, but rather making a conscious decision not to go above and beyond basic duties.
The expression began circulating last summer when an engineer published a video on TikTok that went viral.
But employers who dismiss this as just a social media trend could be making a grave mistake, experts warn.
Allyson Stewart-Allen, chief executive of International Marketing Partners, said: “This is not a passing fad or just another employment cycle. This is a profound reassessment that people are taking time to do, to think about balance.”
She says the onus is now on employers and managers to help their workers re-engage.
“This requires a very different form of leadership – much more empathy, much more understanding, treating people much more holistically than just a warm body who does a job and achieves certain tasks.”