Prior to ‘Freedom Day’, the hospitality industry had already been experiencing staff shortages in the that were having a detrimental impact on businesses ability to operate. Now, as businesses try to recover from the pandemic, self isolation issues are accelerating this problem. What are the reasons for this shortage and how are the government and industry trying to tackle it?
UKHospitality estimated that staff shortages in the hospitality industry were around 188,000 or a vacancy rate of 9% before COVID restrictions were lifted. This as well as the capacity constraints caused by these COVID restrictions meant that just shy of 25,000 hospitality venues were still shut. On top of this, staff shortages and increased numbers of staff having to self isolate has meant that these issues have continued and many venues have had to operate at reduced opening times or close until staff return from their self isolation.
Businesses are desperately trying to recruit, with job adverts in the industry running at 132% of the base level of February 2020, but a reduced pool to hire from as well as other issues caused by external factors has resulted in very few applicants for these roles.
Reasons for the shortage of staff
COVID (including furlough)
Obviously COVID has had the biggest impact on staffing levels in the hospitality industry. When the country went into national lockdown and the hospitality industry’s vulnerabilities were laid bare, many lost confidence with the industry and moved into a different career.
Some workers in the industry did this out of necessity when they were made redundant before the furlough scheme was available. Alex Reilley, chairman of cafe bar operator Loungers, reiterated the lasting impact COVID is likely to have on recruitment in the hospitality industry as prospective applicants become deterred by how susceptible to closures these businesses are. Ensuring that the hospitality industry becomes a more secure sector to work and have a career in would alleviate some of the issues causing staff shortages, but this is largely outside of the industry’s control.
Many industry leaders are now beginning to suggest that the furlough scheme is one of the causes of high staff shortages levels. This is an important factor to note given that in April 2020 one quarter of all furloughed staff worked in hospitality. UKHospitality commended the scheme for ensuring that the livelihoods of those who work in the industry were maintained, but they have also acknowledged the negative impact furlough had on recruitment.
The clearest example of this was from the British Institute of Innkeeping’s Member Survey. The survey found that 35% of member venues had at least one member of staff quit with no notice period as soon as the venue re-opened and furlough payments stopped because they had either secured employment in a different industry or simply didn’t want to return to work after being home for so long. This statistic highlights how many people’s perceptions of the industry have changed due to the pandemic.
Perceptions of the Industry
As well as these external factors, there are some hard truths the hospitality industry needs to accept in order to tackle this staffing challenge. Perception of the industry including long hours and low rates of pay, as well as a lack of investment in employees has exacerbated the impacts of COVID on the desirability of working in the sector.
Many, including Heath Ball (Managing Director of the Frisco Group), have addressed how some in the industry have viewed staff as transient, and highlighted how hospitality has for too long underinvested in training and development which has caused staff to be under-skilled and reluctant to pursue a career in the industry. Addressing these issues by supporting staff and ensuring their wellbeing and development is maintained would arguably go a long way in diminishing this staff shortage and improve staff retention too.
Reduced pool of applicants
Another large cause of staff shortages is the reduction of available applicants due to Brexit and other travel restrictions. The Economic Statistics Centre of Excellence reported that 1.3m people born abroad had left the UK between the end of 2019 and the same point in 2020. Many of these people have not returned the UK either due to COVID travel restrictions or work permit laws implemented because of Brexit.
Given that data suggested that 24% of the hospitality workforce were from overseas prior to the pandemic, the number who have left and haven’t or can’t return is devastating to the industry. The issue of a reduced pool of applicants to hire from is not one that is likely to go away without intervention, and many expect the issue to get worse.
Self Isolation Issues
These problems are being confounded by what many are calling a ‘pingdemic’. UKHospitality are reporting that 1 in 5 hospitality staff are currently in self isolation which is causing business operation to collapse or stop trading completely. Even though the government is putting measures in place to tackle this issue, many think this is not enough. One of the measures that the government is bringing in is changing the rules on self isolation for fully vaccinated people from 16th August. This change will mean that anyone who is fully vaccinated has been in contact with someone who has tested positive can take daily tests to avoid isolating. This however will have little impact on the hospitality industry as 60% of the workforce won’t be double jabbed by 16th August. The government have also announced that some key workers will be exempt from self isolation (negative tests permitting) but which key workers this applies to has not yet been announced.
How the government and industry is tackling this
Recruitment and Industry Drives
Businesses, organisations, and government departments have been working in partnership on several different schemes and campaigns to try and encourage people to work in hospitality. For example, UKHospitality and the DWP are working partnership with Jobcentres to promote opportunities in hospitality. This aims to increase staffing numbers in hospitality whilst also improving perceptions of the industry.
Overhaul of self isolation procedures
The issues caused by self isolation are holding businesses back and many people in the industry are calling on the government to change the rules so that businesses are able to successfully operate now that restrictions have been lifted.
The Government’s Kickstart scheme is still open and provides hospitality businesses and young people a solution to staff shortages and the high competition present in the labour market.
The scheme provides businesses that are successful in their application with a grant to hire local unemployed young people on placements that last a minimum of 6 months. Not only does this scheme provide businesses with an easy and low-cost way to hire local staff, but it also provides the staff with industry specific and soft skills that will aid them in future employment.
If your business is interested in exploring this opportunity, Six Till Six in provide an application support service. You can find out more about the scheme and start the application process HERE