A Shortage of Vision: How to Solve the Labour Market Crisis by Raising Standards

1 November 2021

A collaboration between Autonomy and PIRC

At a glance:

  • 3 in 4 FTSE100 companies cited labour shortages or staff retention issues as a principal risk to their business in the last reporting period. These companies have a collective global workforce of over 4.5 million people.


  • Labour shortages cost businesses greatly. Immediate impacts are an inability to deliver services and products, leading to a loss of clients and income.


  • Three of the hardest hit sectors are: Logistics & Transport, Hospitality and Social Care.


  • When surveyed, 41% of workers in these three key sectors report that they are considering leaving their job in the next 12 months. The figures for each sector are as follows:
    • 39% of Transport & Logistics workers
    • 43% of Hospitality workers
    • 40% of Care workers


  • Of the reasons given for this dissatisfaction, low pay, poor mental health and long working hours scored highly. 


  • Company responses to date are falling short. These include short term changes to retain staff such as bonuses and minor pay uplifts; restructures and intensified workloads; recruitment via agencies; and lobbying for changed regulations to increase the supply of workers. 


  • In the sectors surveyed, the majority of people considering leaving their jobs report being offered no incentives to stay by their employers.


  • Workers in these sectors also reported that a pay rise, shorter working hours for the same pay, and better in-work benefits such as holiday pay and pensions would keep them working in their current sector.
    • 69% of workers in Transport & Logistics said a pay rise would keep them in the sector long term.
    • 71% of workers in Hospitality said a pay rise would keep them in the sector long term.
    • 77% of workers in Care said a pay rise would keep them in the sector long term.


  • Sector level negotiations are needed, involving workforces and their unions, business and government. Long term improvements to future-proof jobs should also follow, such aspay lifts with collective bargaining, decent in-work benefits and a work-life balance that suits the worker.



Phil Jones

Alice Martin

Will Stronge, Director of Research at Autonomy, said:


“The good news is that the labour market crisis can be solved fairly easily by offering better working conditions.

“However the response by companies is falling far short of what is needed and unless they quickly come up with a better offer, our research suggests the crisis is going to get a lot worse in the next 12 months.

“The Covid pandemic has shone a spotlight on unfair and precarious working practices in Britain and it seems that workers have simply had enough.”


Alice Martin, Labour Specialist at PIRC and contributor to the report, said:


“There is an opportunity here to recalibrate employment practices in the private sector, starting with the industries hardest hit by labour shortages.

Rather than looking for quick fixes companies should be taking on board the views of their workforces and trade unions to find long term solutions.”