During the height and length of the pandemic the NTI newsroom often took the position that all of us would know much more about the reality of the (un)employment and corporate insolvency position once the furlough tap had been switched off. The last gush and drip flowed from that faucet on 30 September and we have been waiting on the post-apocalyptic numbers ever since. Were employers duping their people, and our numbers, by keeping their colleagues hanging on until they were forced to make a decision about their futures and that of their businesses? Would unemployment rates rocket from 1 October, to add to the supply chain and transportation crises?
The first official post-furlough numbers were published last week, revealing a stubbornness and resilience in the employment figures that left many observers speechless. The number of payrolled employees grew by 0.6% in October, compared with the previous month (that, quite literally, had 'furlough' written all the way across it). Alongside that the share of workers switching jobs rose to a record high of 3.2%, much of this motivated by people who had resigned and got new jobs, rather than being pushed by their current employers. Some commentators are saying this is people taking advantage of a dynamic jobs market to move from shrinking to growing companies (which is pretty smart of them and makes us wonder where all of these switched on people are, as we look around train carriages in the morning to see many fellow passengers staring gormlessly at their Facebook feed or out of the window at passing shadows).
A business survey revealed that by July 2021 over 60% of companies had engaged in product innovation, with nearly 70% adopting new (better?) management practices. Someone with a name that makes it sound like she is worth paying attention to, Juliana Oliveira-Cunha, who works for an impressive organisation, the Centre for Economic Performance, has suggested that if just 4% of workers moved from the least productive companies to those at the other end of the scale the UK's GDP would grow by six whole percentage points. This adds up to a positive and promising company sector (unless you are a shrinking, poorly managed business who is saying goodbye to a great colleague who insists, ..."really, it isn't me, it's you"), which is as unexpected as it is welcome as we seek to make sense of predictions for 2022.
However, as evidenced by Neil's local being closed on Sunday last week because they 'can't get staff', many companies are being forced to turn away business for lack of workers. While companies hoped these problems would be transitory and would ease over the summer after economies reopened, many now worry that the issues may be more deep-rooted. Many are saying this is the perfect storm of structural decline in labour supply, coupled with unprecedented labour demand, but will people who are standing on the sidelines reassessing their lives after the most bizarre and disturbing period in modern human history step in and fill job roles that don't inspire many of them?
In the Eurozone, unlike in the UK, employment has almost regained its pre-pandemic level and labour force participation has rebounded rapidly; so that in France and Spain it is already higher than it was before the crisis. We can only dream of such numbers, but then we would have to put up with further potential lockdowns and better weather.
