New data released by the BCC show that the construction, manufacturing and hospitality sectors are facing the most severe shortages and firms’ recruitment struggles remain at record levels.

The data for the leading business group’s Quarterly Recruitment Outlook (QRO) for Q2 2022 was drawn from a survey of over 5,700 businesses.

Attempted recruitment in Q2 remained broadly the same as the previous quarter, with 61% of firms looking to find staff (60% in Q1 2022). But more than three quarters of firms (76%) continue to report recruitment difficulties, dropping just two percentage points from Q1 (78%).

The construction sector is facing the most severe recruitment challenges, with 83% reporting difficulties. This is closely followed by production and manufacturing on 79%, logistics on 79% and hospitality on 78%.

In the face of rising business costs, less than a third of employers (28%) have increased their investment in the last three months. Smaller firms are even less likely to report an increase, at just 19%.

Jane Gratton, head of people policy at the British Chambers of Commerce, said: “Businesses remain under huge pressure to fill jobs, but record levels of recruitment difficulty are showing no signs of improvement. Solutions are urgently needed, so that firms can keep their doors open throughout these tough times.”

The BCC has written to the UK government outlining a three-point plan on how they can work with businesses to solve the current crisis:

• Firms must be encouraged to find new ways of unlocking pools of talent – by investing more in training their workforce, adopting more flexible working practises and expanding use of apprenticeships;
• Government must help employers invest in training by reducing the upfront costs on business and providing training related tax breaks; and
• The Shortage Occupation List (SOL) must be reformed to allow sectors facing urgent demand for skills to get what they need.

Ms Gratton added: “The SOL is not currently fit for purpose and should be more flexible, so it supports firms experiencing a national recruitment crisis. Recruitment difficulties have been at record highs for a year.

“There are 1.3 million unfilled jobs in our economy and now fewer people in the workforce than before the pandemic. This is holding back productivity and growth, and employers are at their wits’ end. It is putting livelihoods at risk and damaging the economy.

“The Government must reform the SOL criteria to include more jobs at more skill levels to give firms breathing space to invest in their workforce.

“Employers cannot wait for a new Prime Minister before this is sorted. Shortages are impacting not only on their ability to service order books but also on the morale and wellbeing of their people.

“The economic challenge we are facing is huge and unless we start to fill the hole caused by 1.3 million vacancies, we cannot get back to growth.”