The East Midlands Chamber of Commerce has revealed new data which shows that, while the region’s unemployment rate remains the second-lowest in the country, its economic inactivity rate has risen to 22.2% – well above the UK average.
This measures the proportion of 16 to 64-year-olds who have exited the labour market for reasons such as retirement, caring duties, long-term ill health or studying.
East Midlands Chamber chief executive Scott Knowles said these figures indicate that businesses in Derbyshire are struggling to recruit for key roles – with a shortage of skilled workers to replace those who leave.
“While on the face of it a low unemployment rate is a positive for the region’s labour force, this trend shows there is a major constraint on businesses when it comes to finding the staff they need to fill key jobs.
“The ONS figures reflect what we are finding in the East Midlands, where two-thirds (66%) of businesses attempted to recruit new employees in the second quarter of the year, but 82% of these struggled to find people – according to our latest Quarterly Economic Survey.
“Four in 10 businesses told us they are now at full capacity, which strongly suggests they need staff to meet high demand. From our conversations with members, industries such as manufacturing – which are important drivers of economic output – are struggling the most due to early retirement among workers and a lack of skilled workers to replace them.”
Scott Knowles added that businesses need to think differently to encourage people into work – and called on the Government to help fill vacancies by issuing visas to overseas workers.
“We need to find ways of bringing people back into our labour market. Flexible working practices, rapid retraining opportunities and a focus on workplace health can support many economically inactive people to return to the workplace.
“But for some roles where there is clear evidence of a national skills shortage, firms need access to people at all skill levels from outside the UK. As well as issuing temporary and seasonal visas, the Government needs to urgently review the shortage occupation list.”