Hiring crisis intensifies with labour shortage driving wages up across hospitality

Hiring crisis hospitality wages bar staff
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It’s a perfect storm for hospitality as job insecurity combined with flaws in post- Brexit immigration laws threaten profitable recovery.

 

The hiring crisis reported widely in Coinslot and impacting all of hospitality has forced companies to increase wages by as much as 14 per cent, according to new research from Indeed Flex, an online marketplace for flexible workers. Jack Beaman, CEO of Indeed Flex believes the dynamics of post-lockdown society are coming in to play. He stated: “We’ve seen an influx of people opting for temporary work as a post-lockdown lifestyle choice – as it gives them a variety and a work-life balance that a permanent job cannot. Temporary workers offer hospitality businesses vital flexibility in the current uncertain trading environment in which customer demand is strong, but margins are squeezed.”

According to data provided by Indeed Flex temporary pub and bar staff that are prepared to work at the weekend could benefit from hourly rates that are nine per cent higher compared to 2019. Weekday pay rates have risen by an average of five per cent across the UK, far exceeding the 1.8 per cent rise in the minimum wage between 2019 and 2021.

Pay growth has been the strongest in Greater Manchester and Cheshire, rising by almost 14 per cent since May 2019, compared to the 3.73 per cent rise within the M25.

The spectre of wage inflation is very real. According to figures from recruitment firm Reed, salaries in hospitality have risen by 18 percent, compared to an average across all sectors of just 4 percent. Industry body UKHospitality has said that 80 percent of venues are short of staff. Hospitality has been hit as thousands of EU staff have been lost to the sector as the UK’s skills-based immigration system sifts out lower-paid non-UK nationals. According to ONS data, over 7 percent of EU nationals left UK payrolls during 2020. In addition, furloughed workers who returned home to Europe during the pandemic have opted not to come back. The uncertainty surrounding hospitality prompted by the Government’s inconsistent policies has also led to workers seeking more secure employment in sectors including office and retail.

The increase in overheads is particularly painful for bricks and mortar gambling businesses which are unable to pass-on additional costs in the form of higher prices.


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