New research examines the toll of COVID-19 and its detrimental impact on employment and the lingering skills shortages that exist despite this. 

Research conducted by XpertHR, an online source of legal compliance, good practice and benchmarking information for HR professionals, shows that significant skills shortages are present despite the number of people hunting for work increasing.

Since the start of the pandemic, many businesses have been forced to cut the number of staff to cope with the impact of the virus on businesses nation-wide.

Over two-fifths of organisations (42.1 per cent) stated that their workforce has shrunk since the beginning of the pandemic. Worst hit were manufacturing organisations with almost half (48.8 per cent) reporting a decline in workforce size.

Not only was the pandemic a factor in impacting businesses and headcount but the research also highlights that toll that Brexit took on businesses in the UK.

Despite this, almost three-quarters of businesses surveyed (71 per cent) reported feeling a strong sense of optimism towards their business, feeling either “very” or “somewhat” confident about their business’ outlook.

A significant problem that is facing UK businesses, however, is the problem of skills shortages. Over two-thirds of respondents (68.3 per cent) reported having difficulties in recruiting for some roles or functions over the past year. The most prevalent skills shortages were in IT roles, manual or engineering roles.

This is also expected to be a problem which continues. Of the companies surveyed, over half (56.8 per cent) anticipated trouble finding candidates to fill roles within the aforementioned sectors.

One particularly challenging area for businesses moving forward is the issue of workforce planning. As part of the research, one respondent stated:

We no longer have any idea what our headcount should be. Our workload is very unpredictable and trying to manage staff levels is proving challenging. We are juggling a reduction in turnover and trying to cover staff costs while we have concerns about how we would manage a high amount of absence due to coronavirus as well as the usual winter bugs. Workforce planning has never felt so tough!

To deal with this, XpertHR stated that organisations can plan for uncertainty by “[balancing] their short-term and long-term workforce needs, and by using contingency plans and adaptive planning to adjust their approach as circumstances continue to evolve”.

They further stated that companies should “deal with all [their] staff as honestly as possible and show them genuine care and respect, as the impact of this will be seen in the willingness of employees to be flexible in the short term but also in how they feel and behave towards the organisation for years to come”.

Noelle Murphy, XpertHR senior editor, said:

While the coronavirus pandemic has stress tested workforce planning strategies to the limit, the perennial issue of skills shortages continue. While the current level of labour market churn will mean an increase in prospective applicants, getting those with the right skills will continue to cause employers a headache. Putting succession plans in place and looking at ways to develop skills within the current workforce needs to be a priority for employers, feeding into our ‘new normal’ way of working.


*To obtain these results, XpertHR’s workforce planning survey was conducted in October and November 2020 and received responses from 183 UK organisations.