Individual report – 1500 words (+/- 10%)
Task (50% of the overall mark) Considering the organisation you have chosen for your presentation (Component 1), write a report in which you briefly analyse the main problem then provide and evaluate two solutions to it. You need to refer to the case study that follows the task description.
In your report you should:
• Provide a brief explanation of the problem
• Suggest two alternative solutions to the problem and evaluate them
• Conduct a basic risk analysis
• Produce a plan to implement the decision you would make to solve the complex problem
• Discuss how you would measure the effectiveness of your implementation.
Businesses have been experiencing a shortage of workers In November 2022, 13.3% of businesses surveyed by the ONS reported experiencing a shortage of workers. The percentage of businesses experiencing a shortage of workers has been between 12.9% and 15.4% since October 2021, with the exception of August 2022, when 16.8% of businesses reported a shortage.
The industries with the highest percentage of businesses experiencing worker shortages in November 2022 were Accommodation and food services (35.5%) and Construction (20.7%).
Vacancies are high In September-November 2022, there were 1.19 million vacancies in the UK, similar to the number of unemployed people.
Human health and social work had the highest number of vacancies in September-November 2022 with 208,000, 3.9 vacancies for every 100 employee jobs. Accommodation and food services had the most vacancies per 100 employee jobs, with 6.7 vacancies for every 100 jobs.
Skills shortages Businesses are reporting having difficulty recruiting employees with the relevant skills. In August 2022 the Federation of Small Businesses found that 80% of small firms faced difficulties recruiting applicants with suitable skills in the previous 12 months.
The causes of labour market shortages Labour supply and demand since the pandemic
A key reason for labour shortages is that demand for labour has recovered faster than labour supply since the pandemic.
The Bank of England’s August 2022 Monetary Policy Report points out that labour demand – measured by the number of people in employment and the number of vacancies – is above pre-pandemic levels, while labour supply is below pre-pandemic levels.
Labour supply and employment are below pre-pandemic levels because of a rise in economic inactivity – people who are not in work and not looking for work. In August-October 2022, the leading reasons for economic inactivity were being a student (27%) and a long-term illness (27%). 13% were inactive because they were retired.
The impact of Brexit on labour supply While the UK is not unique in experiencing shortages of materials and workers, commentators have noted that new immigration rules post-Brexit may have exacerbated the situation. There are different views on the extent to which Brexit-related factors are contributing to labour supply issues in the UK.
The Bank of England reports that slowing population growth is partly responsible for a decreased labour supply, which has been driven by lower net migration from the EU.
A September 2021 ONS article provides statistics on how many companies cited a lack of EU applicants specifically as a reason whythey were unable to fill vacancies. Almost half of businesses in the Transport and storage sector (46% of businesses) cited this, as did over a third of businesses in Administration (40%), Education (39%) and Arts and recreation (36%).
