Firms now 'coping'
CBI wants COBR for business to resolve growing disruption
Tony Danker: ‘firms have moved from growing to coping’
Businesses have made a sudden switch in ‘mindset’ from growth to crisis management and are demanding a change in approach from government to resolve underlying issues such as labour shortages and disruption in the energy market.
The CBI wants the existing Cabinet Office task force turned into a ‘COBR-level’ group tasked with finding quick solutions to key problems holding back the economy.
It says a Government & Business Taskforce would draw on the success of the Scientific Advisory Group for Emergencies (SAGE) which has worked alongside Ministers to design rapid-fire solutions during the pandemic.
The CBI praised the establishment of a special taskforce aimed at curbing driver shortages, supply chain disruption and wider labour concerns under Cabinet Office Minister Stephen Barclay, but said the time had come to elevate both the nature and power of this group.
The CBI says a ten-day consultation with 800 member companies reveals a “significant shift from a growth and investment mindset to a crisis management mode” across all sectors and sizes of firm.
Businesses also felt “real frustration” at what is seen as simple response from some parts of government, especially over labour shortages “where Ministers claim that simply raising wages will solve the problem”.
Tony Danker, CBI director-general, said: “After speaking with hundreds of business leaders this week it’s clear there’s a total mindset shift from growing to coping. This is now a major threat to our recovery, and the Government needs to step up its response to a new level of both speed and boldness.
“While many of these challenges are global in nature, the solutions we need are local. The right long-term answers to our current labour and skills shortages are investing in skills, automation, pay and conditions.
“But none of these solve the problem quickly. Government is right to keep up the pressure on companies to adapt and not rely on immigration long-term, but temporary visas are the only way to alleviate the disruption of shortages in critical skilled parts of the economy in weeks and months instead of years.
“Establishing a crisis management Taskforce to move quickly – with both business and government around the table – will ensure Government is far more informed about the nature and scale of the challenges.”
Driver shortages are hitting every part of the economy, creating gaps on supermarket shelves, leaving pubs and restaurants short of key produce and jeopardising the supply of key chemicals to water firms.
The SNP is among those who have blamed Brexit and tighter immigration rules for causing the labour shortages and supply chain issues facing the UK.
However, the problem is Europe-wide with shortages also being reported in Germany and Poland.
Britain is said to be short of more than 90,000 drivers, a problem that was exacerbated by the pandemic when training and testing was suspended.
The Prime Minister is expected to grant visas for thousands of foreign drivers in a bid to tackle the shortages, while soldiers will also be drafted in to help at HGV testing sites to clear a backlog trying to get licences.
Sources in the industry say higher pay and visas are not the solution and that the problem lies with younger people not being attracted to the haulage business because of unsocial hours, while rising salaries in eastern European means many of those who had moved to the west no longer have an incentive to do so.