Why the Government needs to take action on immigration to help firms - CIPD

The Chartered Institute of Personnel and Development (CIPD) has called on the Government to intervene on immigration policy, along with introducing reforms to skills policy and providing effective support for businesses.

A new report from the professional body for human resources (HR) and people development found that 44 per cent of organisations in Yorkshire are finding it hard to fill vacancies, despite 69 per cent looking to recruit over the next three months.

It also identified that jobs in many low-paid sectors across the UK are facing acute talent shortages, including hospitality, 51 per cent, and health and social care, 49 per cent.

Daphne Doody-Green, head of CIPD Northern England, said: “The Government’s ambition to level up the North and create a thriving economy, that is less reliant on migrant workers, will be undermined unless there are short-term interventions on immigration policy, along with effective support for businesses, to tackle the labour crisis.

“We also urgently need pioneering reforms to skills policy and the training landscape to ensure everyone, no matter where they live or their background, can gain the skills they need to progress in work at any stage of their lives.”

The CIPD’s report ‘Addressing skills and labour shortages post-Brexit’, is based on a survey of more than 2,000 employers in low-paying sectors and focus groups.

It calls on the Government to tackle the region’s labour crisis and ongoing measures to reverse two decades of underinvestment in skills, through three key measures. The report says the Government should introduce a temporary job mobility scheme for young EU nationals to act as a ‘safety valve’ to ease immediate, acute labour shortages.

The report also calls for reform of the Apprenticeship Levy to create a broader, more flexible training levy to boost employer investment in skills.

It also says £60m should be provided to fund a business improvement consultancy service through the Growth Hub network to help more firms invest in new technology and improve their people management and workforce development capability.

Where employers in Yorkshire and Humber are acting to address hard-to-fill vacancies, the CIPD report found the most popular planned response is to upskill existing staff, 41 per cent.

Other responses included hiring more apprentices, 33 per cent, and raising wages, 29 per cent.

Only 1 per cent said they would make a greater effort to recruit older people.

Ms Doody-Green added: “This report highlights several challenges that employers in low pay sectors face in attracting and retaining staff, including not having the resources or capability to respond to labour shortages.

“Those with recruitment difficulties also don’t always realise the benefit of widening their search and reaching out to under-represented groups such as older workers and returners to work.

“We hope that the upcoming Chancellor’s spending review recognises the need for improvement in the quality and availability of business support, to pave the way for greater investment in skills and labour shortages over the longer term.”

Chancellor Rishi Sunak will deliver a budget statement and a three-year public spending plan next week.

Earlier this month, Prime Minister Boris Johnson vowed to end “the old failed model of low wages, low skills, supported by uncontrolled immigration”.

The Confederation of British Industry (CBI) has urged the Government to not increase the tax burden for companies when the Chancellor makes his announcement on Wednesday.

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James Mitchinson