Skip to main content

Shortage of Workers

Volume 823: debated on Wednesday 6 July 2022


Asked by

To ask Her Majesty’s Government what steps they are taking to address the shortage of workers in the United Kingdom.

My Lords, with around 1.3 million vacancies currently available, the Government recognise the importance of filling vacancies in support of business and economic growth. Our approach focuses on how we can best support jobseekers and employers to overcome the barriers to recruitment, retention and progression in their sector. The Way to Work campaign focused on bringing employers and claimants together in our jobcentres to fill vacancies faster. As of 29 June, we estimate that at least 505,400 unemployed universal credit and jobseeker’s allowance claimants moved into work between 31 January and the end of 26 June.

I thank the Minister for her detailed response, but the UK is suffering an employment crisis. Our workforce has shrunk by at least 500,000, with some estimates saying nearer 1 million —the biggest percentage drop of any G7 economy—and as the Minister says, we now have more than 1.3 million unfilled vacancies. Labour shortages do not just cause economic disruption; they fuel wage inflation and damage productivity—a classic recipe for stagflation.

Some employers are now employing underqualified or untrained staff and having to pay them 20% more. When will the Government respond to the scale of this crisis and come up with a comprehensive package of new measures to address this mass exodus of workers?

The DWP is running numerous programmes to get people back to work to try to fill those vacancies, because, as the noble Lord said, the lack of workers and skills is not helping the economy. We do have a new Chancellor.

My Lords, there are indeed lots of vacant jobs with no applicants, but that is just for government Ministers of course.

The Government approach the problem of vacancies as though the basic problem is lots of idle, unemployed people. They pour money into restarting Kickstart and start big sanctions, but what we have is a crisis of economic inactivity. For example, we have a whole load of people aged over 50 who either lost or left their jobs in the pandemic and never came back, and we have a post-pandemic crisis of mental and physical ill-health. Is not that where the Government should direct their energies?

I am very pleased to tell the noble Baroness that that is exactly what we are doing. For older workers—those over 50—there is a £22 million fund to boost employment support. I can assure the whole House that we are not looking at people as being idle; we are looking at them as people with potential and the ability to add value to an employer. We are working very carefully with them to get them in a position to do that.

My Lords, I hope my noble friend will stay in post whatever happens. She will know that there are many thousands of people with a disability who are none the less capable of filling some of the vacancies now available. While the Government have an excellent record with their Access to Work scheme, could they do more to unlock the talents of disabled people by beefing up some of the other schemes, such as the Work and Health Programme and the Disability Confident employer scheme?

Again, I am pleased to respond to that question, because we set a target to have 1 million more disabled people in work between 2017 and 2027. By Q1 2022, we had 1.3 million, so we have smashed the target and are not stopping now. I assure all noble Lords that we are working to get disabled people into work, because they have great skills and employers are taking them very seriously.

My Lords, I welcome the Government’s Statement on the 22 measures they intend to take to support the aviation industry. Eight of those relate to improving recruitment of staff. It is now six years since the Brexit vote, and we have had two and a half years of the pandemic. That made it clear to the Government that they would no longer be able to rely on the pool of European labour and of previously trained labour. Why did it take the Government so long—until this week—even to start to address the inevitable staff shortage that has flowed from this?

I note the point the noble Baroness makes about shortages in the aviation sector, and there have in fact been problems in road haulage and other sectors. But the Government and the DWP have been working closely with trade bodies and employers to try to work things through. All I can say is that I am sorry we were not quick enough.

We all know—indeed, the last speaker just pointed it out—that one of the main reasons for the shortage of labour is Brexit. As the CEO of Ryanair said, that is the single biggest problem, but it is not helped either by Covid. However, there is a solution the Government unfortunately will not consider, even though it builds on their tremendous work to fast-track Ukrainians with relatives in the UK. What is stopping the Minister from doing the same for refugees from other countries, with relatives who are prepared to sponsor them? Let them work; let them live; let them contribute to British society.

Immigration policy is not in the DWP’s gift. I suggest the noble Lord takes that up with the Home Office, although I am happy to help by diverting his question to the Home Office. The noble Lord is correct about Ukrainian refugees: we have done a lot to get them into the benefits system and get them national insurance numbers. I am pleased to say that a lot of them are highly skilled and qualified, and we look forward to integrating them into the workforce.

My Lords, fruit and vegetables are rotting in the fields. What on earth are the Government doing to get enough seasonal workers to pick them?

I will leave that to my noble friend to make the suggestion.

The SAWs visa scheme makes sure that people can have a visa if employers promise to pay them over £20,000. I am pleased about that, because then the “cheap labour” heading goes. One swallow does not make a summer, but today I spoke to one of the biggest fruit providers in Kent and it has managed quite well in getting in seasonal workers. If you pay and treat them well, and give them good accommodation, it seems they will come.

My Lords, does the Minister accept that a general shortage of labour is a symptom of excess demand? You cannot assuage that by importing labour from abroad for the simple reason that workers not only produce but consume goods and services. The extra demand they create exactly equals the extra demand they assuage.

That is why, when Tony Blair justified opening our boundaries to free labour from eastern Europe because there were 1 million vacancies, 3 million more people entered but there were still 1 million vacancies.

Thank you, my Lords. I commend the Government on protecting jobs and preserving high employment levels, but I put in a plea regarding the immigration situation. Health and care workers are put into the same bracket when we talk about special visas, but the majority of care workers—more than 90%—earn less than the £20,000 limit. Would it be possible to have a special channel for overseas care workers in the current emergency situation where so many vulnerable and elderly people are left without care and homes are having to close?

We are working with the DHSC and the DfE to promote opportunities and routeways into adult care. We are using our sector-based work academies to get people skilled, but the health and care visa is available to qualified professionals looking for work in the sector as long as they meet the minimum eligibility criteria, which includes a salary minimum of £20,000.