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Labour shortage underlines importance of wellbeing support

With record long-term sickness and more job vacancies than unemployed people in the UK for the first time ever, wellbeing support is becoming crucial to staff recruitment and retention.

The latest statistics show that national unemployment reached just 3.5 per cent in August 2022, and with job vacancies still significantly higher than pre-pandemic levels at around 1.2 million, this means there are now more vacancies in the economy than people looking for work.

According to the Confederation of British Industry (CBI), around three quarters of UK businesses have been hit by labour shortages in the last 12 months. Affected businesses are taking a range of measures in response:

  • 55 per cent are investing in training to upskill current employees
  • 56 per cent are investing in base pay
  • 45 per cent are taking action to improve their Employee Value Proposition; and
  • 40 per cent are investing more in technology and automation.

However, one of the key drivers of the tight labour market is a record 2.5 million people becoming inactive due to long-term sickness, a problem that is particularly evident in the 50-64 age bracket. Experts agree that health and wellbeing support now has a crucial role to play in recruiting and retaining skilled and experienced employees.

Manufacturers have previously been warned that a lack of wellbeing support could result in losing out on talent, and many are responding. Research shows that half of UK manufacturers have increased their spending on health and wellbeing initiatives since the start of the pandemic, investing in areas such as third party advice, line manager training, peer-to-peer support and staff events. 

Commenting on the CBI’s survey and labour market figures, Carmen Watson, Chair of recruitment firm Pertemps Network Group, said:

“Candidates are in a position to be very selective. It is not all about salary – real pay growth currently stands at minus 2.5 per cent, taking into account inflation, so employees are feeling the pinch. As well as doing everything possible to address this pay growth shortfall, it is about the whole package of incentives, wellbeing support and flexible working that is on offer when an organisation is seeking new employees.

“The figures in this survey should be a wake-up call to any businesses who are not already taking a long, hard look at their attraction and retention policies. For companies to survive this, they need robust attraction and retention policies, with investment in training and development and a focus on diversity, equality and inclusion, as well as the environmental performance of the organisation.”


GC Business Growth Hub is able to support SME manufacturers in Greater Manchester with fully-funded expert guidance on labour shortage and skills development challenges. For more information, contact one of our Manufacturing Advisors today.

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