The unexpected recruitment crisis

For the last 2 years we have been forewarned that a crisis of unemployment is on the horizon but instead we are facing an unexpected predicament – a shortage of casual workers.

We are seeing the number of people that are willing to accept work on a casual basis is drastically dwindling. This type of work includes undertaking work on a temporary or as-needed basis for a company – typically in a bar or restaurant, as building site contractors, farmhands and Christmas temps. These workers are not part of the permanent workforce and will work irregularly. We are most familiar with the “zero hours” worker, but individuals on short term/ fixed contracts or those without contracts all fall under the ‘casual worker’ title.

Why does our economy need casual workers?

Companies want to hire casual workers because of the flexibility they provide along with the fact that working relationship can be ended with little difficulty when a business see a slow in workload due to season for example.

However, temporary or zero hours contracts do not motivate employees to stay or join a business, as much as a permanent contract as there is a lack of security and they are subject to a fluctuating income.

The perfect storm of Brexit and the Coronavirus pandemic has resulted in the job market becoming an “employees’ market”. A survey carried out by recruitment firm Hays stated that 80% of businesses are looking to take on more staff in the next 12 months, as they begin a recovery journey.

Whilst many expected there to be a lull and a dark cloud of unemployment as furlough ended, that does not appear to have happened.

Where have all of the casual workers gone?

There has been a redistribution of hospitality workers particularly, some moving to delivery jobs, and because of the higher wages (Amazon paying as much as £22 an hour!) the reliable income and the potential for more sociable hours, they do not appear to be looking back.

It is also interesting to note that 200,000 millennial workers left the hospitality industry last year, many of which will have been in casual working roles. Millennials may have seen other more ‘stable’ job vacancies and decided that now they are getting older, they want to choose security and the hope of getting a mortgage over casual work that ebbs and flows.

What is the knock-on effect of casual work vacancies remaining unfilled?

Hotels and restaurants are capping the number of bookings they will accept, some restaurants are closing their doors 2 days out of 7, supermarket shelves are left empty and/or unreplenished… the list goes on.

The effect on the workers in this industry is that they are doing the jobs of 2 or even 3 people as businesses are so short staffed. These workers are going to be working longer hours with less breaks and will eventually burn out or look to change industries.

Employers are also subjected to expensive agency fees for temporary staff or to recruit and train new hires to get them up to speed quickly, all of which costs precious time and money some businesses can ill afford at present, especially when you consider the rising utilities costs which are increasing overheads.

What can these industries do to pull staff back in?

There is pressure on the government to allow more workers from abroad to fill UK vacancies. There are even temporary visa schemes for poultry workers, pork butchers and lorry drivers to come to the UK to ease the burden.

In 2021 there was a 5% average increase in pay, compared to a national salary increase average of 3%. However, this only seemed to encourage competitors to also up their wages, and businesses began losing trained staff to the highest bidder, rather than enticing new starters.

Rather than throwing money at the problem, the changes need to be much deeper. The reputation of these ‘casual’ industries need to change to entice individuals and provide the opportunities to grow, developing a career for life rather than viewing these industries as a stepping stone to a better prospect. Investing in staff should always been seen as an investment for the company in the long term.

What steps should you take?

Stepping away from zero hours contracts and instead offering minimum hours to casual staff could be a step in the right direction. This would offer companies some degree of flexibility in responding to busy and quiet periods whilst the staff can enjoy the security of being an employee. Hiring staff as employees is a fixed cost to companies, but it may be a cost they should not avoid. It can be advantageous for employers too as the employer would have more control over their staff than when they were workers. Employees can then be managed regarding conduct or performance issues.

Perhaps flexible working contracts could be the answer- the option to offer staff days off in lieu during busy periods to take during quieter months?

Specifying when staff cannot take annual leave in their contracts, could allow the business to anticipate when staff will be needed. For example- an ice cream shop on the pier could specify that staff taking annual leave is restricted during August.

Regardless of whether hiring staff on a permanent basis is something that a business can do or not, it is vital that they create a culture that the workforce are proud to be part of. Simple things such as, giving staff as much notice as possible for their rota, giving staff a heads up if a week is looking particularly quiet or busy so they can plan around it and manage their finances adequately will go a long way.

A business can create an encouraging environment where staff feel valued by noticing their hard work. ‘Team member of the month’ schemes, suggestion boxes, team meetings and team building activities can be inexpensive ways of integrating staff. By establishing these relationships and promoting a great workplace culture, staff retention and recruitment will improve.