The UK has recently received warnings from various industries of potential shortages in the coming months. As reported by the Bank of England, there have already been shortages in “furniture, car parts and electrical goods”. Supermarkets have also signaled that there will be some product shortages.
The head of the Food and Drink Federation, Ian Wright, warned that issues with supply chains are “going to get worse” as the just-in-time system begins to fail. Supply chain issues will inevitably lead to fewer products on our shelves. This would mean that prices are likely to rise, resulting in inflation.
The main reason for the failure of products to arrive in the UK is due to a significant shortage of HGV drivers to transport goods. The Road Haulage Association (RHA) has estimated that there is currently a shortage of around 100,000 drivers. The reasons for such shortages vary depending on who you ask.
The government has claimed that the pandemic is responsible for recent issues with supply chains. Although this is true, it is not the only reason that should be considered. The UK has been hit harder by shortages than other European countries. Northern Ireland has also had less disruption than other parts of the UK, which is likely due to them remaining in the single market.
As argued by the Confederation for British Industry, Brexit is one factor contributing to the shortages. However, the government has refused to agree with this position. Yet, to ignore the issue of Brexit is to be in denial of the evidence provided by businesses that the current arrangements are not efficient.
According to the RHA, around 20,000 drivers that have left the profession were EU workers. Due to new immigration rulings, it is difficult to hire other European workers to replace those that have left. This may be the beginning of a trend across industries, as EU labourers leave the UK market to find work elsewhere.
The RHA and businesses are calling for HGV drivers to be recruited from the EU under temporary visas. This may provide some relief, although politically it is a difficult stance, which explains why neither the Conservatives nor Labour have explicitly called for this.
The government has firmly rejected the suggestion to hire more EU workers. Grant Shapps, the Transport Secretary, stated that the UK has to “stand on our own two feet”. If the UK is to do this though, then working conditions must be improved for drivers.
Although the UK does have plenty of licensed drivers, the country is struggling to retain many. One reason for a lack of retention is due to HGV drivers retiring. HGV drivers are part of an ageing workforce, with the average age of a driver being 55. Furthermore, around 380,000 drivers are expected to retire in the next five years.
One government strategy has been to urge drivers to work longer hours. Hence, they have extended maximum working hours from nine to ten hours a day, with eleven hours a day being permitted up to twice a week.
Here, the government is lacking competence. This proposal ignores the fact that long hours are part of the multitude of reasons as to why many leave, or do not join, the profession. Unfavourable working conditions inevitably deter prospective employees from becoming HGV drivers, while simultaneously frustrating current drivers. Additionally, longer hours undermines driver safety, which has led to some businesses, such as Kinaxia Logistics, to refuse to enforce the new rules.
Therefore, other means of alleviating the shortages are required. One suggestion is to increase pay in order to reflect the value of driver’s work. This approach was taken by Aldi and Waitrose, which have both increased wages for their drivers. Iceland’s managing director, Richard Walker, has also argued this could alleviate the problem. Furthermore, the TUC general secretary, Frances O’Grady, stated that “a proper pay rise” is one of several ways to help solve the issue.
In addition to retaining current drivers, new drivers will be required too. This has led to the government overhauling the testing system, with test rates being set at around 3,000 per week in order to make up for the labour shortages. However, there have been concerns over the safety of this approach, with the managing director of BJS Distribution Storage saying that “making the test easier does not make better drivers”.
There has been some speculation that the army may become involved if the shortages worsen. Yet, this approach would only provide short term relief and would avoid addressing the underlying issues of stagnating wages, long working hours and a shrinking workforce.
The government, so far, has been reluctant to relate the shortages to Brexit, and to some extent has avoided debates around drivers working conditions. Instead, they have shifted the blame onto the pandemic. Although it is correct to suggest that the pandemic has contributed to this issue, it is also necessary to recognise the long-term issues of Brexit and unfavourable working conditions.
If the government continues to ignore these other factors, then they are in denial of evident facts. This will limit the UK’s ability to adequately respond to the issue, which may consolidate or prolong shortages in the months to come.