Britain’s job vacancies top one MILLION as struggling sectors blame Covid

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Britain’s job vacancies have topped one million for the first time with struggling sectors blaming the pandemic and Brexit. 

The Office for National Statistics (ONS) said the surge in available jobs was powered by the hospitality sector, with businesses struggling to fulfil roles.  

Figures also show numbers on payroll have returned to pre-pandemic levels after rising 241,000 between July and August, moving 1,000 above the level before the crisis erupted.

The ONS also said that the rate of unemployment dropped again in the quarter from May to July to 4.6 per cent.

Jonathan Athow, ONS deputy national statistician for economic statistics, said: ‘Early estimates from payroll data suggest that in August the total number of employees is around the same level as before the pandemic, though our surveys show well over a million are still on furlough.

‘However, this recovery isn’t even: in hard-hit areas such as London, and sectors such as hospitality and arts and leisure, the numbers of workers remain well down on pre-pandemic levels.

‘The overall employment rate continues to recover, particularly among groups such as young workers who were hard hit at the outset of the pandemic, while unemployment has fallen.

‘Vacancies reached a new record high.

‘Not surprisingly, this is driven above all by hospitality, the sector with the highest proportion of employers reporting their job openings are hard to fill.’

Ali Capper, Chair of British apples and pears, laid bare the struggles affecting her sector on BBC Radio 4’s Today programme this morning.

She said: ‘We advertised locally for 70 fruit pickers and we had 9 applications but on follow-up only one was available and she has since got a job. In terms of recruiting locally, we failed completely. 

‘We have recruited both directly and through a labour provider and we have a mix of Polish, Romanian, Bulgarian, Russian, Ukrainian, a real mix of lovely seasonal workers. I have to say we haven’t got quite as many as we would like but they are all working very hard and we are getting the harvest in.

‘The sector at the moment is at crisis point, Fruit and vegetables are picked all throughout the year but our peak is through April to October and at the moment the whole industry is running between 10 and 35% short of labour. 

‘That means that fruit and veg are not being picked. There is food waste on our farms. And while we do have a seasonal workers pilot that is bringing 30,000 workers, it’s just simply not enough. 

‘We need more permit operators. We need more permits and we need to get that opened to more sectors like flowers and ornamentals.

‘So, the sector really is in a very difficult place and then I go into the permanent roles in our sector and talking to businesses in the east yesterday, one just said to me it’s a mess. 

‘He’s having to change shift patterns, his own packhouse is 24% short and there is deep concern about the run-up to Christmas. It feels at the moment the government is just presiding over chaos in our sector.

Daniel Browne, who owns Blossom and Browne Sycamore which has a royal warrant to provide laundry and dry cleaning to hotels in London, also said his firm was affected. 

He explained: ‘We service at roughly 60 hotels in London and we’ve got to the point where we have to provide the clients notice because we can’t provide the service to them purely because of a lack of employees. 

‘We just can’t get them. So it’s heartbreaking. We were a very successful business pre-Covid, pre-Brexit and now without the staff we are unable to provide the services and it’s just horrific.

‘We put our rate of pay up but we are still not attracting employees – the workforce is diminished because of Brexit. To give you an idea, a hotel housekeeper was historically £9 an hour. They are now offering that job at £15 an hour but we still can’t find employees.

‘We’re going change our business model. We’re going to make it smaller and better and we’re going to be able to service the clients with a lesser workforce. 

‘We’ll be doing less and making less but we have no alternative. We need 30 new employees. We can’t source them.’

Meanwhile, Ocado revealed it is to spend up to £5 million extra this year in pay rises, recruitment and signing-on bonuses for HGV drivers.

The online grocer said the shortage, caused by Brexit and the Covid-19 pandemic, has become ‘an increasingly important issue for the industry’ and that it will try to mitigate costs where possible.

Bosses also revealed they will face a further £10 million hit this year due to a fire at the company’s warehouse in Erith, south-east London, in the summer which led to around 300,000 customer orders worth £35 million being cancelled.

Sales fell 10.6% to £517.5 million in the 13 weeks to August 29, in part due to the fire but also because of strong comparisons last year at the height of the pandemic.

The company said the period should be looked at in two distinct halves and that sales were only down 1.8% in the first six weeks – before the fire. The following seven weeks saw sales down 19%.

It was the third fire to hit an Ocado warehouse in three years, with its site in Andover, Hampshire, only recently returning to full operation two years after a blaze.

Despite the falls, Ocado said it signed up 64,000 new customers during the period, with 805,000 in total, and orders per week rose 22%.

However, the average basket size was down 12% to £124 compared with £141 a year ago.

Bosses are confident the company can continue its strong growth, announcing that capacity at its warehouses in Hatfield, Hertfordshire, and Dordon, Warwickshire, have increased, allowing 600,000 orders a week to be completed.

They also announced plans to open two new warehouses in Luton and Bicester, which will allow the company to increase capacity to 700,000 orders per week.

Tim Steiner, chairman of Ocado Retail, said: ‘Despite the challenges we faced in the period, I am delighted to report that Ocado Retail is performing well, improving the customer experience even further and continuing to grow the business in a post-lockdown environment.’

Discussing the soaring vacancies, Suren Thiru, head of economics at the British Chamber of Commerce, told the Telegraph: ‘The jobs market has continued its summer revival but record vacancies also highlight the acute hiring crisis faced by many firms. 

‘With Brexit and Covid driving a more deep-seated decline in labour supply, the end of furlough is unlikely to be a silver bullet to the ongoing shortages.

‘These recruitment difficulties are likely to dampen the recovery by limiting firms’ ability to fulfil orders and meet customer demand.

‘Although the peak in unemployment will be lower than previous downturns, with rising cost pressures and an increasingly onerous tax burden likely to stifle firms’ recruitment intentions, a notable rise in job losses as furlough ends remains probable.’ 

Chancellor Rishi Sunak said: ‘Today’s statistics show that our Plan for Jobs is working – the unemployment rate has fallen for 7 months in a row, the number of employees on payrolls is back above pre-pandemic levels and there were fewer potential redundancies notified in August than at any point since the start of last year.

‘As we continue to recover from the pandemic, our focus remains on creating opportunities and supporting people’s jobs.’

Minister for Employment Mims Davies added: ‘As we continue to push ahead with our recovery, it’s great to see another significant fall in unemployment and the number of people on payrolls rising by 241,000 in August – the biggest monthly increase on record – showing our Plan for Jobs is working.

‘We’re helping employers recruit for the record number of vacancies out there, particularly in growing sectors, and supporting people of all ages and backgrounds to overcome barriers, land their next role, and progress in work.’