Can we serve up another jobs miracle?
Hospitality and retail staff face cuts but the recovery from the 2009 recession offers hope for the employment market, writes Tim Wallace
How does a nation rebuild after the greatest economic calamity in the best part of a century? The last time that a “once-in-alifetime” cataclysm took place – yes, just a decade ago – the UK bounced back remarkably quickly.
Unemployment rose far less in Britain than it had in previous recessions. The 2010s turned the nation into a job-generating machine.
By 2017, joblessness was down to levels not seen since the Seventies. Could the country repeat this feat in the years after the Covid-19 recession?
The answer depends on the type of industries which survive and thrive, and whether or not they can offset those which struggle. For clues, look to the jobs created since 2009. The number of jobs climbed by 4.3m over 10 years, according to the Office for National Statistics.
Professional, scientific and technical positions led the way, with 820,000 extra white-collar roles, typically with good pay. Administrative and support services added a 675,000-strong army of staff. Health and social work was the next biggest, adding 612,000 jobs.
Accommodation and food services rounded off the really big growth industries, having added more than 550,000 jobs over 10 years. This last category is the most likely to leave a crater in the economy now.
While office staff can often work from a laptop at home, and health workers are clearly in enormous demand, it is face-to-face customer service jobs which have been smashed by the pandemic. At the peak of the lockdown in May, four fifths of workers in accommodation and food services were on furlough. The sector is reopening only gradually, with consumers often cautious about sitting indoors. That is bad news for its typically young and low-paid workers.
Large parts of retail fall into the same category, with high street footfall down 40pc on 2019 levels. Recruiters expect the trends of recent years to reassert themselves, with serious consequences for workers.
“The big trend was that British consumers were more valueconscious around what they bought in shops, but perfectly willing to go out for the night,” says Neil Carberry, chief executive of the Recruitment and Employment Confederation.
“I suspect that trend will continue, so retail in its classic shop-based form was in secular decline before this happened, and the crisis amplified and accelerated that.
“Whereas hospitality and culture, if we get through it, on the other side, you cannot see restaurants or pubs no longer being a thing.”
As a result, workers supplying goods to consumers could end up in warehouses, logistics or web design instead of the shop floor, while hospitality jobs will return slowly. We are still in the early days of the recovery, but so far hiring trends indicate that workers with digital skills are in high demand, to support others who are working from home, and to serve the online economy.
This month, the REC found surging demand for web developers, graphic designers and lorry drivers.
This is an unusual mix of vacancies for the generation of students and school leavers who might normally have found their first jobs in shops, pubs and restaurants.
Tony Wilson, director of the Institute for Employment Studies, notes that warehouse jobs typically come with fewer career development opportunities than high street roles. On the other hand, the boom in IT jobs could be more promising for young workers. Frequently, they begin in helpdesk roles, working their way up to more skilled and well-paid positions. There are jobs out there, but they need different skills.
“The pandemic has exacerbated skills shortages that already existed in the UK labour market,” says Simon Winfield, managing director of Hays UK and Ireland. “The skills most in demand range from management and leadership skills through to the ability to adapt to change.
“The latter will be all the more important for professionals to develop in order to thrive.”
Public money is being earmarked for training, apprentices and careers help, but if employers want to fill those skills gaps quickly then they will have to offer more training themselves.
It is worth remembering that the jobs market is never set in stone, and workers are always shifting positions.
Even with the huge hiring spree of the 2010s, some sectors shed workers. Public administration and defence lost more than 230,000 staff. Financial services and insurance, the powerhouse of the economy, did not recover fully from the financial crisis and is still down 7,000 workers.
This year will still be extremely painful. But Britain’s flexible labour market, combined with a large dose of targeted help, could mean a repeat of the “jobs miracle” of the past decade.
A worker carries drinks to Liverpool FC fans following the reopening of pubs after lockdown restrictions were eased. The hospitality sector is among the hardest hit by Covid-19