Chamber comment on today’s employment statistics

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The ONS employment figures for September show that gaps remain between the North East, and the rest of the country concerning the labour market.

Between May and July, the unemployment rate in the North East for those aged 16+ was 1.1% higher than the national average. Similarly, the economic inactivity rate for people aged 16-64 in the North East remained higher than the national average, by 3.6%. The North East’s employment rate for those aged 16-64 was 4.1% lower than the national average.

In the North East, the unemployment rate has improved by 0.5% compared to last year. However, the employment rate is 0.5% lower, and economic inactivity has worsened by 1%. The rise in economic inactivity is due to a variety of reasons; one being the significant rise in long term ill health, which is a concern.

In due course, we will be working with our members regarding employment issues they are facing to make sure they are represented to our best ability. We will also keep engaging with our national counterparts at the British Chamber of Commerce regarding employment and skills, to ensure the North East’s voice is heard throughout the new government.

Notes

Data published by the ONS shows between May and July 2022, the average unemployment rate in the UK for ages 16+ was 3.6%. In the North East this was higher, at 4.7%

The UK’s average employment rate for ages 16-64 was 75.4%. In the North East this was lower, at 71.3%.

The UK’s average economic inactivity rate for ages 16-64 was 21.7%. In the North East this was higher, at 25.3%.

The North East has the highest unemployment rate

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Marianne O’Sullivan, policy adviser, latest column for The Journal.

From the latest employment statistics the North East continues to have the highest unemployment rate and the lowest employment rate across the UK. We are the only region to have experienced slight decreases in jobs and employment overall from November 2021 to January 2022.

The North East also remains the region with the highest economic inactivity rate in England – too many people have left our workforce altogether. The North East economic inactivity rate stands at 24.8%. This compares to a national rate of 21.3%. According to the ONS people aged 50 and over have seen the largest increase in economic inactivity out of all age groups. This is having a large impact on the workforce and adding to labour shortages.

In the longer term there needs to be a focus on skills shortages as this is playing a significant role in limiting growth. We need to make the most of talent in the region to allow everyone to access opportunities. The North East is a leader in sustainable energy with the potential for more jobs around a green recovery, the region needs to have the training in place to encourage people into growing sectors in the region.

Apprenticeships are an important route for younger people and for people looking to change careers, they have been highlighted by the Government’s Social Mobility Commission as a key route into employment as well as employers needing to widen their talent pool.  

We are working with employers, education providers and the Government to tackle the skills gap in the North East. Our upcoming linking business with education event in July will help to share best practise from businesses and discuss how they can effectively engage with education providers.

Our Good Work Toolkit has highlighted how employers can offer staff training and progression opportunities in the workplace.  This is complemented by our further toolkit focussed on ensuring women, in particular, can progress in their careers.

We have some work to do to catch up with the rest of the country but it is certainly not down to a lack of determination and tenacity.

There is so much potential in the North East and with the right support for our employers and education providers we can start to narrow this persistent employment gap.

We need every single person in the region to be able to succeed and become part of our success.

Labour market comment from the Chamber

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Arlen Pettitt, knowledge development manager, North East England Chamber of Commerce said: “There are some signs of improvement from the first three months of this year, as employment increased and unemployment fell, but we still have a gap to the rest of the country.

“The national picture may show unemployment at the lowest levels since 1974, but the North East story is different, with the highest unemployment rate, lowest employment rate and highest economic inactivity rate in England. Closing the gap to the national averages will be one of the key measures of the Government’s levelling up agenda.

“Businesses are telling us that costs are their main concern – inflation, energy, taxation, and pressure the cost of living is putting on staff pay. There was nothing in last week’s Queen’s Speech which addressed the urgency of these issues, and we need to see the Government’s act quickly to make sure the tentative improvement we’ve seen continues through the rest of 2022.”

Notes:

Employment in the North East stands at 1,199,000, a rise of 12,700 (1.1%) over the quarter but a fall of 8,700 (0.7%) over the year. The North East employment rate stands at 70.9%. This compares to a rate of 75.7% nationally.

North East unemployment stands at 62,700, a fall of 7,400 (10.6%) over the quarter and a fall of 10,700 (14.6%) over the year. The North East unemployment rate stands at 5.0%. This compares to a national rate of 3.7%.

Economic inactivity in the North East for those aged 16-64 stands at 408,000, an increase of 7,300 (1.8%) on the quarter and 28,300 (7.5%) on the year. The North East economic inactivity rate stands at 25.2%. This compares to a national rate of 21.4%.

The seasonally adjusted claimant count stands at 72,700 in the North East. This is a fall of 3,800 (5.0%) over the month and a fall of 42,500 over the year (36.9%). The claimant count rate for the North East is 5.2%.

The employment data covers the period January to March 2022. The provisional claimant count data is for April 2022.

Closing the Neurodiversity Employment Gap

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Neurodiversity consultant and coach Mark Charlesworth kicks off our series on neurodiversity by explaining what neurodiversity is and the steps we need to take in order to put an end to the neurodiversity employment gap.

 

What is Neurodiversity?

The term ‘neurodiversity’ was first coined in 1998 by Judy Singer in her contribution to an academic series on disability, human rights, and society. The phrase initially referred to those on the autism spectrum. Autism Spectrum Condition is a neurodevelopmental disorder that affects how a person thinks, recites, recalls, processes, learns, and retains information differently to those not on the autistic spectrum.

‘Neurodiversity’ has since branched into becoming an umbrella term for other neurodevelopmental conditions that handle information differently in the ways described, such as ADHD, Dyslexia, Dyscalculia, Dysgraphia, and Dyspraxia.

Whilst in its purest sense, ‘neurodiversity’ means a diversity of difficulties, styles, and strengths of thinking, recalling, learning, etc., the neurodiversity ‘movement’ focuses on those who handle information differently because of a neurodevelopmental condition.

The conditions have an impact on a person’s social interaction too, but there is no correlation between a person’s intelligence and whether or not they have a neurodevelopmental condition.

 

The Neurodiversity Employment Gap

Despite, in most cases, having good to high intelligence, there is an employment rate disparity between those with the neurodiverse conditions above and their peers. Less than 20% of neurodiverse adults aged 16 to 64 are employed. The next lowest rate of employment is those with epilepsy, at 37%.

Once you know about a condition and how it affects a person in a given situation, then you are in a stronger position to help the candidate and colleague thrive in the process and become a valued member of the team.

Despite legislation and a vast array of information available in the internet age, very well-meaning recruiters and employers are not sure how to close that employment gap, or sure where to turn for help.

Because of the employment rate gap and also being personally excluded from the job market, I, like many other neurodivergents, have turned to being self-employed to help educate employers and recruiters to ensure that we can progress with equal opportunity.

 

How Can We Close the Neurodiversity Employment Gap?

Ok, so if you want to change and close that gap, where can you start?

Firstly, you should understand the basics of neurodiversity, and therefore each condition, so that you have a good grounding to make progress.

Secondly, you should keep the message and understanding of neurodiversity simple. If you complicate matters, then the message becomes confused and less likely to be acted on. Each condition affects everybody differently, so the details are theoretical and hypothetical until you actually meet a candidate with a particular condition. The candidate can then explain the detail of their needs, which you can fine-tune as you progress together.

Thirdly, you should remember that each person has a multiple number of strengths they will bring as part of their condition. To identify what they are, you will need to encourage confidence and trust so that the candidate will open up about a very personal matter. Once you have built that trust, then, and only then, is the candidate likely to open up.

Fourthly, if a person does open up about their condition, you should bear in mind that those with neurodiverse conditions very often hide and underplay their needs.

And fifthly, if a person tells you about a condition they have, then they may also have a comorbid condition, but not always. This condition may or may not have a diagnosis, and they may not know how to tell you or want to share with you part or all of their neurodiversity that makes them special.

 

Keep an eye out for the next blog in this series in which Mark explains how to attract and recruit neurodiverse talent!

 

To find out more about Mark’s services you can visit him on his website, call him on 07502 464481, or email him at [email protected]

 

Photo by Keenan Beasley on Unsplash

Chamber comment on today’s employment stats

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Niamh Corcoran, policy adviser, North East England Chamber of Commerce said: “Today’s labour market figures continue to paint a mixed picture. Whilst unemployment has fallen by 12.9% over the quarter, employment levels have also fallen by 1.35% and regional levels of economic inactivity have risen at the fastest rate in the country. Long-term ill health and new-found caring responsibilities seem to be the primary driver of this trend. The government should do more to support those in economic inactivity, where possible, to re-enter employment. 
 
“Staff shortages continue to be a problem for businesses, with vacancy levels again reaching record highs this month. Businesses are continuing to struggle to find the staff and skills they need in their business. If this trend continues, it is likely that businesses will be unable to operate at full capacity and productivity will suffer. 
 
It is clear that more needs to be done to bridge the economic inactivity gap and make it easier for businesses to recruit the talent they need. This includes more investigation into rising levels of long-term ill health and bespoke support for those in economic inactivity to re-enter work, as well as an expanded upskilling and retraining offer for adults to better equip workers with the skills businesses need.”
 
This month’s stats:

  • Employment in the North East stands at 1,145,000, a fall of 16,000 (1.35%) over the quarter and a fall of 19,000 (1.6%) over the year. The North East employment rate stands at 70.7%. This compares to a rate of 75.4% nationally.
  • North East unemployment stands at 64,000, a fall of 10,000 (12.9%) over the quarter and a fall of 20,000 (23.6%) over the year. The North East unemployment rate stands at 5.1%. This compares to the national rate of 4.3%.
  • The claimant count stands at 93,000 in the North East. This is a fall of 1,800 (1.9%) over the month and a fall of 27,400 (22.8%) over the year. The claimant count rate for the North East is 6.5%. 
  • The employment data covers the period July to September 2021. The provisional claimant count data is for October 2021. The next release is the 14th December 2021. 

Staff Shortages…

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Our UK economy has been hit by a wave of staff shortages, unseen since the 1970s. Research shows that businesses across the country are struggling to recruit the staff needed to operate at full capacity, with labour shortages present in a variety of sectors and role types, from entry-level hospitality positions, to veterinary practitioner roles which are needed to validate animal produce traded with the EU.

The Road Haulage Association estimates that there is currently a shortage of around 100,000 HGV drivers, meaning supply chains are overstretched. Customers are already seeing the impacts of this, with supermarket shelves increasingly bare. As the run-up to Christmas edges closer, there are concerns from sector experts that supply problems will cause widespread stock shortages.

The shortage of HGV drivers is having a particularly deep impact on the North East’s ability to trade. As a result of their inability to transport the goods, a small manufacturing member of Chamber has had to cancel six orders, while other companies have had to inform international clients that they cannot guarantee deliveries on time. Businesses are concerned that this could hamper their chances of winning supplier contracts.

So, what has caused such extensive labour shortages?

The pandemic has caused widespread labour shortages across Europe, with many foreign workers returning home to wait out the crisis. The US, Germany and France are also struggling with a shortage of HGV drivers for example; however, the UK has been hit hardest due to the new immigration system, which put a stop to freedom of movement with the EU. There are now strict entry requirements for skilled talent, whilst the entrance of so-called ‘unskilled’ workers, including care workers, hospitality staff and HGV drivers, has been blocked.

The shortages caused by the pandemic and the EU’s exit will likely be a longer-term problem; businesses expect to see shortages remaining for two years at least. Employers are working hard to create a strong domestic talent pipelines, but this is a long-term project, and the Government needs to allow employers more flexibility to hire the staff they need from outside the UK while this is established.

We recently wrote to the Government pushing for urgent changes to the system to be made to ensure that businesses in the North East can recruit the staff they need. The changes we proposed included creating a temporary route for unskilled roles critically needed to meet economic or social priorities. We will continue to push Government on this critical issue.

Chamber disappointed with Government response to migration labour shortages

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North East England Chamber of Commerce’s calls for more flexibility and action to tackle acute staff shortages since Brexit have gone unheeded by Government.

In response to the Chamber’s letter setting out proposals to tackle the substantial difficulties facing the region’s businesses the reply said ‘While the Government recognises some businesses will need to adjust, investment and development of the UK’s domestic labour force should take priority, rather than seeing migrant labour as the solution to recruitment difficulties.’

Businesses across the NE and the UK are currently struggling to fill vacancies as a result of the UK’s exit from the European Union reducing the talent pool available to businesses and the impacts of the pandemic.

This is happening across sectors, from hospitality and leisure, to road haulage to food processing.

Niamh Corcoran, policy adviser, North East England Chamber of Commerce said: “We are very disappointed that Government has refused to consider our constructive suggestions such as creating a temporary route for unskilled roles critically needed to meet economic or social priorities such as care workers or lorry drivers. Businesses urgently need changes so they can recover from covid-19, meet consumer need and expand and grow.”

The Chamber’s view is that a shortage of HGV drivers is already negatively impacting businesses in the North East. One Chamber member, within the Food & Drink sector, has been forced to reject six orders because they cannot guarantee the goods can be transported on time.

The inability to rely on goods being moved when required is making it increasingly difficult for businesses to trade internationally. This is in addition to challenges presented by the UK’s exit from the European Union and a global logistics crisis, with prices for shipping containers, for example, skyrocketing.

Niamh Corcoran said: “The crisis will only deepen as we approach Christmas and demand for fully stocked shelves, bookings for Christmas parties in bars/cafes grow and the social care impacts of Covid begin to emerge.

“We will continue to push Government to tackle this urgent issue.”

Chamber statement on today’s employment figures

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Niamh Corcoran, North East England Chamber of Commerce policy adviser said: “Today’s employment figures show a slight dip in the regional labour market after several months of strong growth, with employment having fallen slightly by 9,000 or 0.8%. This is out of step with the national figures, which show the UK as a whole seeing continued improvement in the labour market with falling unemployment and rising employment.  

The North East entered the Covid-19 pandemic with lower levels of employment and higher levels of unemployment, making the region’s recovery from the pandemic more difficult. Government needs to commit to the levelling up agenda by ensuring that all regions are supported to recover and that none are left behind. 

Nationally, job vacancies are 21% above pre-pandemic levels, though long term unemployment is up by 40%. We need to see increased support for those furthest from the labour market to help them into work and better matching of those out of work to suitable and sustainable jobs.  

Chamber member Jackson Hogg is continuing to deliver the people needed to grow businesses. From its base in Newcastle with 54 staff, the specialist recruitment and outsourced talent services business has recruited 15 additional staff since January and continues to expand its services in the North-East, wider UK, Europe and USA. 

Having deepened its presence across the STEM sectors, the business is seeing increased demand for skilled staff across its client-base. Since the most recent lockdown, the company saw significant movement of mid-senior level candidates who had previously been nervous about changing jobs in an uncertain economy or where they’d felt undervalued by their employer.  

With the majority of clients securing key project wins recently, the war for talent is back on. The best employers in the market will be demonstrating fantastic company cultures that embrace flexible working, whilst offering employees realistic opportunities for personal and career development. The pandemic has shown that more jobs can be carried out remotely than previously thought, leading many employers to cast their net nationwide in the search for top candidates. 

Richard Hogg, CEO of Jackson Hogg said, “We’re blessed with fantastic loyal clients who are hungry to grow and need a partner that has a strong network that understands their business and cultural fit as they expand. Although many of our clients have been successful in securing strong order books, there are still significant headwinds with supply chain problems or availability of components, which are having a damaging impact on achieving revenue and cash flow targets. These influences could well have played a part in today’s figures. 

“Whilst now is a great time to be looking for a new job, many clients are struggling with the availability of talent and businesses are needing to offer significantly higher salaries and more attractive working environments to attract new staff which is driving salary inflation. Now is not the time to be falling out with your high performers or future leaders. Equally, if you have a great business and can attract high quality talent, you should seize the opportunity to capitalise on the market.”  

End of furlough- what’s happening?

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The Job Retention Scheme, implemented to support employers with staff costs through the Covid-19 pandemic, is due to close at the end of September. This blog outlines what changes are coming into force and what this could mean for businesses and the local labour market.

What is the Job Retention Scheme and when will it end?

The Job Retention Scheme, also known as furlough, was created by Chancellor Rishi Sunak in March 2020 to prevent employers from having to make redundancies during the Covid-19 pandemic. It enabled employees to remain employed or engaged by a company despite not undertaking any work for them, or only working on a part-time basis. Although it was only expected to last for a few months, it has repeatedly been extended as the second and third waves of the virus arose. For many it has acted as a lifeline by both preserving employee incomes and enabling businesses to retain staff.  At the scheme’s peak in July 2020, more than 190,000 jobs were furloughed in the North East.

Originally, the Government paid 80% of the wages of people placed on the Job Retention Scheme, up to £2500 monthly. However, as the pandemic eases and businesses reopen, the Government has begun the process of winding down the scheme, with the aim to end it fully in September. In July 2021, employers were required to contribute 10% towards the wages of furloughed workers for hours their staff did not work. The Government continued to contribute 70%, keeping the employee’s pay at 80% of their normal wages.

Since the beginning of August 2021, employers have been required to pay 20% of a furloughed staff members’ wages, with the Government contributing 60%. This will continue to be the case until the 30th September.

After that date employers will no longer be able to place employees on furlough leave and will either need to bring employees back into work or begin redundancy processes.

More information can be found here.

What impact will the end of the Job Retention Scheme have on unemployment rates?

The impact that the end of the Scheme will have on unemployment is unclear. The most recent statistics show that 64,000 jobs are currently on furlough in the North East, with the region’s furlough take up rate at 6%, lower than the national average take up rate of 7%. The region’s slightly lower rates of furlough could mean the North East fares better than other areas, like London or the West Midlands which have a higher uptake of the Scheme.

However, the North East suffers from generally high rates of unemployment which could leave it more vulnerable to any national increase. Research conducted by the National Institute of Economic and Social Research has predicted that the close of the Scheme could raise the national unemployment rate from 4.8% to 5.4%.

It is likely that some sectors will be impacted by the end of the scheme more than others. The manufacturing sector has the largest number of employments on furlough in the North East. Manufacturers are also facing other pressures, including climbing inflation, continued challenges in the logistics sector and a shortage of materials which could dampen the sector’s post-lockdown recovery and ability to bring back employees.

Chamber statement on today’s employment stats

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“Employment figures published today are encouraging for the North East, with the labour market showing strong signs of recovery. For the first time since the beginning of the pandemic, the region now has more workers in payrolled employment than it did in February 2020, before Covid-19 had hit.

“However, labour and skills shortages are beginning to emerge, with firms in sectors like hospitality and logistics struggling to recruit the staff they need. In addition, long-term unemployment is an increasingly concerning problem in the labour market, particularly for older and younger workers,

“As the July reopening gets underway, Government should continue to increase investment in adult education so those in unemployment can rapidly retrain and upskill and ensure that jobcentres have the resources they need so that those looking for new opportunities can be fully supported into work. Not only this, but with the impacts of the immigration system beginning to bite, Government will need to assess whether the system is flexible and accessible enough for businesses to recruit the talent they need to grow and, where necessary, make urgent changes.”