Firms still battling labour challenges despite fall in unemployment – Chamber
Business leaders today called on the Chancellor to use the forthcoming Autumn Budget to address the labour force challenges that are hindering business growth.
Despite new data from the Office for National Statistics (ONS) revealing unemployment in the West Midlands has fallen by up to 1.1 per cent, Greater Birmingham Chambers of Commerce said firms are still battling against recruitment challenges.
The ONS said today that unemployment fell by 1.1 per cent in the June to August 2024 period, while the employment rate increase by 0.9 per cent from the previous quarter.
The economic inactivity rate - measuring the percentage of people aged 16 to 64 who are not in employment and have not been looking for work in the last four weeks – decreased by 0.1 per cent.
Nationally, the estimated number of vacancies decreased on the quarter for the 27th consecutive period, by 34,000 to 841,000.
However, they remain above pre-pandemic levels.
Emily Stubbs (pictured), head of policy at Greater Birmingham Chambers of Commerce, said: “It’s encouraging to see a potential decline in the unemployment rate in the West Midlands, however, caveats by the ONS suggest that due to issues with sample sizes, this may be overstated.
“Our Quarterly Business Report surveying suggests that locally, ingrained challenges remain for those firms looking to recruit new staff, with over two thirds of firms attempting to hire reporting difficulties doing so.
“Meanwhile, as recruitment challenges continue to contribute to the cost pressures on local businesses, many are also concerned that the Autumn Budget may lead to a higher tax burden – particularly an increase in National Insurance contributions – and that recently announced employment reforms could further drive up costs.
“The Chancellor has a key opportunity to address the labour force challenges continuing to restrict economic growth.
“Firstly, by better supporting those with long-term health issues back into work through a reduction in both the employer and employee tax on workplace health services.
“And secondly, by bolstering local training provision and providing longer-term funding for the ongoing work associated with Local Skills Improvement Plans, to help providers work with more businesses to provide the right training for more people.”
The Chamber’s latest Quarterly Business Report will be launched at Birmingham City University on 7 November - register your free place.
