Bryony Gibson, director of Bryony Gibson Consulting, shares an insight into how the General Election could impact the labour market.
Writing ahead of the General Election, there’s a consensus in recruitment that whoever our government is, they must improve their strategy to support the labour market.
From bridging the skills gap to changing employment law and immigration policy to positively shape the talent pool, creating a correctly skilled workforce is essential to kick-start economic growth and productivity.
That is why I’ve been looking into the two main party’s policies, to see what the future holds…
Labour
Promising ‘no surprises’, largely because every announcement was shared before the launch of their manifesto, Labour plans to introduce a new ‘Industrial Strategy’ that works in partnership with commerce.
Focusing on growth, there is an emphasis on flexible training, a plan to modernise employment law, bring more clarity to workers’ rights, and support compliance with flexible employment practices.
Establishing a new body called ‘Skills England’, they aim to bring businesses together with training providers, unions, the migration advisory committee, and the government in the hope of ensuring training in England meets the overall needs of the labour market.
With a pledge not to increase National Insurance, the basic, higher, or additional rates of Income Tax, VAT, and cap Corporation Tax at 25%, they promise a ‘balanced approach’ to immigration that will address skills shortages in healthcare and public services.
Conservative
Declaring to ‘guarantee a more secure future for you, your family, and our country’, the Conservative party promises to steer us towards prosperity and social unity through a ‘modernised tax system for business’.
Including a 2p cut to National Insurance, the abolition of the main rate for the selfemployed, and maintaining the National Living Wage at two-thirds of median earnings, they hope to help businesses and support workers.
With a focus on small companies, which make up 99% of the UK private sector, they plan to retain tax incentives that encourage growth, including EIS, SEIS, Venture Capital Trusts, Business Asset Disposal Relief, Agricultural Property Relief, and Business Relief.
Promising reform to better target disability benefits, the introduction of a legal cap on migration to protect public services whilst bringing in the skills business and the NHS need, they also plan to fund 100,000 new apprenticeships for young people and give working parents 30 hours of free childcare a week.
While there is plenty to ponder, the need for an overarching strategy that seeks to understand and consider the skill needs of our workforce does not appear. I believe we need a skills policy that is suited to the needs of our economy, but it must go beyond skills. Investment and infrastructure matter if we want to build an economy that can grow at speed.
Currently, the number of overall job vacancies in the UK remains ahead of prepandemic levels and people are confident about being able to recruit. One of the biggest challenges I see each day is that pay growth continues to rise due to talent being in short supply.
The Office for National Statistics estimates that labour and skills shortages cost the economy £39bn annually. The next government needs to act quickly to ensure more people have access to the right training and skills for the market.
The first step is to understand what people want. If the government is to be successful, it must embrace this idea and recognise that there are many types of work, and all are equally valuable.
Improving transport links, enhancing childcare support, better education, addressing immigration issues in key sectors, and reviewing tax and regulation issues are also going to be crucial to building a vibrant and successful economy