Britain’s ageing workforce could put the brakes on the country's economic recovery
The recession will arrive as post-Brexit labour shortages hit the pipeline of available recruits
The coronavirus pandemic is transforming workplaces across the world, with offices and factory floors adjusting to social-distancing rules. For metal pressing company Bruderer UK, it has underscored a weakness in the British economy that management has been grappling with for years.
About 60 per cent of employees at the firm’s plant in Luton, southern England, is aged 60 and above, putting them statistically at higher risk of complications from Covid-19 than younger workers. Chief executive Adrian Haller said he’s been trying to train apprentices and hire fresh blood for years, but to little avail.
The combination of an ageing workforce in some sectors and the potential changes to worker availability and migration rules, essentially is coming together with this huge increase in unemployment.
Stephen Evans, Learning and Work Institute
“Our engineers couldn’t go out to site because of their age,” said Mr Haller. “There’s a massive space between the ages of 25 and 40. I’ve been looking for service engineers for over four years. It’s horrendous.”
Already mired in the worst productivity slump since the Industrial Revolution, the UK is now headed for the deepest recession among developed nations after recording more Covid-19 deaths than anywhere else in Europe. The downturn will arrive as the decision to leave the European Union’s seamless labour market reduces the supply of workers who previously helped plug skill shortages in some industries that are key cogs in the economy.
From producers of medical packing components to lorry drivers and agriculture, the pandemic has made the need to address the rapidly ageing workforce more urgent.
With young workers bearing the brunt of job losses, Chancellor Rishi Sunak said on Friday that one of his priorities is to support people who have lost their job to find new work. He is scheduled to unveil more details of recovery plans in the coming weeks.
“The combination of an ageing workforce in some sectors and the potential changes to worker availability and migration rules, essentially is coming together with this huge increase in unemployment,” said Stephen Evans, chief executive of the Learning and Work Institute, which develops policies on employment and skills. “If we invest now, we can improve them together.”
One area where the challenge is particularly acute is among hauler companies. Lorry drivers carry 98 per cent of goods in Britain, making them the logistical backbone of the economy. Yet their average age is about 57, according to the Road Haulage Association.
Finding younger people able – or willing – to invest as much as £5,000 (Dh22,740) in qualifying for a licence to drive a lorry isn’t easy. The job typically pays only marginally higher than the average wage and a life on the road doesn’t appeal to everyone.
To fill the resulting 60,000 shortfall in personnel, companies have for years looked elsewhere. Depending on the day, up to 60 per cent of the lorry drivers on UK roads are from continental Europe. A post-Brexit requirement that immigrants can only take jobs paying at least £25,600 could halt that.
The pandemic has laid bare the risks of failing to bring more young people into the job. The government even had to change rules that require heavy goods vehicle drivers over 65 to undergo an annual medical examination, after warnings that a lack of appointments in a stretched health service could force up to 30,000 truckers off the road.
“No lorries would have been disastrous for medicine, a disaster for supermarkets, and for all of us,” said Rod McKenzie, policy director at the haulers association, which is leading a government-backed initiative to recruit a more diverse driver pool. “We shouldn’t take things for granted. If things work well now, that doesn’t mean to say you can forget about it.”
Lorry driving is an extreme case, but across the economy, a shift is happening as the birth rate drops to a record low and better healthcare prolongs our active lives. Over 11 per cent of those over 65 are still working, more than double the proportion 20 years ago. While a higher activity rate is a positive for the economy, relying on those older workers with no supply line of new recruits to replace them is not.
Even now that lockdown restrictions are being lifted, sexagenarians and others with underlying health issues are warned to take special care to minimise contact with others. That’s easier for HGV drivers, but not simple in most workplaces.
Bruderer chief executive Mr Haller has had to find a way to keep his business operating while protecting employees that may be at greatest risk. Most were unable to do their job while isolating at home.
The company is still operating at half of its capacity as some workers – including one aged 75 – continue to shield from the virus and sluggish demand has slashed revenue to a quarter of usual levels.
Coronavirus could help to solve some of the problems it has exposed. With the right, targeted support, people who have lost their jobs could be retrained to fill some of the gaps.
But younger workers’ attitudes and skill-sets have been shaped by successive governments encouraging higher education over vocational qualifications. A 2010 study found that 32 per cent of teens aged between 16 and 18 in Britain were undertaking technical training, compared with almost half in the rest of the EU.
That was laid bare this year in farming. With about 12 per cent of agricultural workers aged over 70 and little interest among younger people, the industry has long relied on a huge number of seasonal workers from Eastern Europe to bring the harvest in.
Once it became apparent that those pickers would struggle to arrive this year, industry bodies and the government tried to encourage furloughed British workers into the fields with a high profile “Pick for Britain” campaign. But while data from jobs site Indeed showed an initial jump in interest, recruiters said that few actually accepted positions.
For Mr Haller, making precision metal parts is hardly more popular. He’s relocating the firm to the Midlands, a region in the country’s industrial heartland with more training centres and potentially a larger pool of qualified workers.
The trick is to bring the balance right. Finding trained, skilled workers in their 30s and 40s is where Bruderer struggles most, he said.
“You need to have a guy with a wide varied experience, so you do need age,” he said. “When I go out and try to bring a new electromechanical engineer, the quality is not there at all.”
Updated: June 30, 2020 09:26 AM