Ministers must make it easier for UK companies to hire workers from abroad as labor shortages continue to affect sectors such as hospitality and agriculture, according to the head of the British Chambers of Commerce.
Shortages persist in some industries despite a record level of net migration of more than half a million people in the year to June 2021 and the government’s relaxation of its “shortage occupations list” earlier this year to ease for construction workers to arrive in the UK, said BCC director general Shevaun Haviland.
“We have a list of occupation due to shortages, they are the mechanisms of this current government,” he said. “This is not about rampant immigration. It’s about using those structures to turn on the taps in specific places to help ease the pressure on businesses.”
Other industries affected by labor shortages include social care and fruit picking. Some hotels were unable to operate at full capacity because they couldn’t get enough staff, Haviland said.
Representatives of the food and agricultural sectors have also called on the government to ease immigration rules. The industry gathered in Downing Street on Tuesday for a summit on food safety, where Prime Minister Rishi Sunak vowed to boost UK self-sufficiency.
At the summit, Sunak confirmed that in addition to the 45,000 visas that the Department of Environment, Food and Rural Affairs will provide to horticultural workers next year, there will be capacity for another 10,000.
Ahead of the meeting, the National Farmers Union called for a minimum five-year renewable seasonal worker plan to alleviate severe labor shortages on farms. The trade body estimated last year that up to £60m of produce was wasted due to a lack of fruit and vegetable pickers.
Meat processors, meanwhile, have had a hard time hiring butchers with the level of English language proficiency required by current law. immigration rules. Nick Allen, chief executive of the British Meat Processors Association, said the industry had become dependent on butchers from the Philippines and it cost around £12,000 to bring them to the UK.
“When Brexit happened, we were 70 per cent non-UK workforce at our meat plants. We have a big challenge to replace that with British workers,” he said.
Haviland cited the example of a boatbuilding company in Poole, Dorset, where the owner said it was unable to complete its £700m order book due to a lack of fiberglass rolling mills, which used to come from Europe. from the east. The necessary replacement workers will take two years to train locally.
She said ministers last summer had been receptive to an expansion of the list of shortage occupations, but less so in recent weeks.
Haviland, who took up his job with business lobby groups two years ago, will address members on Wednesday at the BCC’s annual conference, which is attended by business leaders and senior politicians, offering an optimistic view of Britain. as a “great place to start a business”.
But he said the companies faced a challenging backdrop, having been destabilized by a year of political chaos, the spike in energy bills caused by Russia invasion of ukrainelabor shortages and wage inflation.
However, UK companies were not guilty of “greed” or price gouging, Haviland said.
Businesses were absorbing huge cost increases and trying not to pass them on to customers, he said. “I think we’ve probably estimated that there’s input inflation of about 20 percent and output inflation of 10 percent,” she said.
Some central banks have warned that “greed” risks entrenching price pressures, with US corporate profit margins hitting their highest level in 70 years in 2022, according to a University of Massachusetts study.
Eurozone companies have also increased their profitability sharply in the past two years, according to research by French bank Natixis, but current and former Bank of England officials have suggested UK companies were not profit.
Haviland’s intervention comes as Labor lawmakers called in the House of Commons on Tuesday for a temporary economy-wide “excess profits tax” similar to the windfall tax imposed on the oil and gas sector.
The business was recently rocked by allegations of rape, sexual harassment and intimidation at another employer lobby group, the CBIwhich led to more than 50 prominent members cutting or suspending ties.
Haviland said that, in the wake of the allegations, BCC management had checked that its own processes met the standards. Asked if the organization had found evidence of harassment or similar allegations, he said: “No, not that I know of.”
Haviland expressed sympathy for the victims of the alleged crimes and for some of the 250 CBI employees whose jobs were now under threat, but said the BCC was “having discussions” with some unnamed former CBI members about joining their organization.