Marvin OnumonuThe latest Quarterly Recruitment Outlook from the British Chambers of Commerce (BCC) Insight Unit found that a quarter (25%) of firms planned to grow their workforce in the three months ahead.
Just over half (54%) had tried to recruit between August and September, with 75% facing difficulties.
Recruitment challenges remained high in construction, with 85% reporting problems.
Other services firms were at 78%, and transport, hospitality and professional services each reported 74%.
Most firms kept staffing levels the same in the third quarter, with 61% reporting no change.
Less than a quarter (22%) increased staff, down from the previous quarter.
Looking ahead, 63% expected staffing to stay the same, 12% expected to lose staff and 25% planned to increase numbers.
Labour costs continued as the main pressure for businesses, mentioned by 72%.
This was highest in hospitality at 80% and lowest in retail at 66%.
Training investment stayed mostly flat, with 24% increasing spending and 19% reducing it.
Jane Gratton, deputy director of public policy at the BCC, said: “Employers are battling against sky-high employment costs and widespread skills shortages.
“The stark reality for firms trying to recruit is that it’s still far harder than it should be.
“Unless more is done to boost access to skills and contain employment costs, economic growth will remain stunted.”
Gratton added: “The skills crisis also has far-reaching implications for government policy.
“While Ministers have pledged to get the nation building again, with recruitment difficulties in construction spiking to 85%, delays to getting vital infrastructure in place are inevitable.
“And with 72% of firms saying costs are putting pressure on them to raise prices, the spectre of higher inflation will continue to hover.”
She said: “The situation is not improving, and there is a growing urgency to find solutions.
“The new technical excellence colleges will help increase the supply of some vital skills.
“But much more needs to be done and the coming budget presents a golden opportunity to unlock potential through targeted investment and incentives.”
She added: “There is a huge talent pool in the UK that remains untapped.
“Almost a million young people are not working, training or in education, while three million people are missing from the workplace due to long-term sickness.
“The government should use the tax system to help people stay in – or quickly return to – employment when they experience ill health.”
She said: “Tax breaks for health services that businesses provide to their workforce are an obvious solution, to protect people’s livelihoods and keep skills in the workforce.
“And for those struggling to get into work, we need a wage subsidy scheme, similar to Kickstart, to unlock employment opportunities for young people with long-term health conditions.”
