Vacancies drop but wage bills climb as hospitality tackles labour issues

By James Bayley

Published: 09 March, 2023

Labour shortages at Britain’s top managed hospitality groups may be starting to ease, but rising wage bills are piling more pressure on some fragile businesses.

The 2023 Business Leaders’ Survey from CGA by NIQ and Fourth shows that one in 11 roles (9%) are currently vacant and open for application. It marks a drop of two percentage points since the last survey of leaders in October 2022.

Furthermore, the proportion of staff leaving a business in the last three months has dipped by three percentage points to 16%.

Despite improvements since the turmoil of Brexit and Covid-19, vacancy and churn levels continue to cause concern. Only a third of leaders (33%) say they feel confident about their ability to recruit.

Read more: Rising consumer confidence is the blue sky we’re all looking for

Attracting and keeping staff has also come at a significant cost, with hospitality businesses raising their pay by 12% and 11% for new and existing staff respectively in the last 12 months, just ahead of the rate of inflation.

The survey also highlights some efforts made to improve conditions for workers. Well over half (57%) of business leaders say cultivating the right working culture has been effective in improving retention, while a high level of communication with staff (41%), a focus on staff wellbeing and mental health (33%) and creating learning and development opportunities (33%) have also been impactful.

Sebastien Sepierre, MD at EMEA, Fourth, said: “While the pressures related to labour shortages might be starting to ease, it is apparent that workforce-related challenges are very much continuing to keep operators awake at night. The fact that only a third of business leaders feel confident about recruitment right now, indicates the importance of retaining existing members of staff and keeping them motivated.”

Karl Chessell, CGA’s director of hospitality operators and food, EMEA, said: “It is encouraging to see that hospitality’s hard work on recruitment and retention is starting to pay dividends. However, with thousands of jobs still vacant, wages rising sharply and the cost of living crisis hitting consumer spending, there is no room for complacency. Hospitality is one of the UK’s most dynamic industries for job creation and it can kickstart the economic recovery, but first, it needs targeted government support on labour shortages and cost challenges.”

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