May 9, 2021

Skills Shortages Continue Despite Impact of COVID on Employment – new research from XpertHR

The impact on the economy from the coronavirus (COVID-19) outbreak is stark when it comes to employment, but businesses remain concerned about filling certain positions, according to research from XpertHR.

With the onset of the pandemic, the HR profession had to take difficult decisions around employee numbers in some sectors, where even with the introduction of the Coronavirus Job Retention Scheme businesses could not justify the headcount in place.

More than four in 10 (42.1%) of the organisations surveyed by XpertHR reported that their workforce has shrunk since the start of the pandemic. Manufacturing organisations were particularly hard hit, with 48.8% reporting a decline in workforce size, while public sector organisations were most likely to have seen no change.

The knock-on effects of the pandemic and Brexit are expected to have the biggest influence on how organisations fare, along with the effects of both on the economy. Only a handful of organisations reported no concerns for their business over the coming year.

However, there is also a strong sense of optimism, with more than seven in 10 (71.6%) organisations feeling either “very” or “somewhat” confident about the outlook for their business. Confidence was lowest in the public sector, perhaps reflecting a concern about further austerity measures.

Skills shortages for certain occupations – around seven in 10 (68.3%) respondents told us they had experienced difficulties in recruiting for some roles or functions over the past 12 months, with most skills shortages centred on IT roles, manual roles and those in engineering.

Looking ahead, more than half (56.8%) also anticipate difficulties in recruiting for some functions in the coming 12 months, due to skills shortages. Among them, IT, manual and engineering roles were again most likely to be cited.

Workforce planning

Workforce planning is designed to help deal with periods of unpredictability – surges and plateaus in business and demand. However, as one respondent told us, the coronavirus pandemic has changed that: “We no longer have any idea what our headcount should be. Our workload is very unpredictable and trying to manage staff levels is proving challenging. We are juggling a reduction in turnover and trying to cover staff costs while we have concerns about how we would manage a high amount of absence due to coronavirus as well as the usual winter bugs. Workforce planning has never felt so tough!”

Many respondents within the hospitality sector referenced the unpredictability of demand in the industry in non-pandemic times, and how the current situation is putting the sector under even greater strain. One respondent told us that they currently do not have enough employees to cope with an upturn but cannot risk employing more staff as they fear they will have to let them go before too long.

Organisations can plan for this uncertainty by thinking about how to balance their short-term and long-term workforce needs, and by using contingency plans and adaptive planning to adjust their approach as circumstances continue to evolve.

At all times, XpertHR advises organisations to “deal with all your staff as honestly as possible and show them genuine care and respect, as the impact of this will be seen in the willingness of employees to be flexible in the short term but also in how they feel and behave towards the organisation for years to come.”

XpertHR senior editor Noelle Murphy said:

“While the coronavirus pandemic has stress tested workforce planning strategies to the limit, the perennial issue of skills shortages continue. While the current level of labour market churn will mean an increase in prospective applicants, getting those with the right skills will continue to cause employers a headache. Putting succession plans in place and looking at ways to develop skills within the current workforce needs to be a priority for employers, feeding into our ‘new normal’ way of working.”