U.K. Worker Shortages Are Cited as a Concern by More Companies
More U.K. companies are citing a shortage of workers as a concern for the months ahead, two separate surveys showed, adding to constraints on the recovery.
The CBI, Britain’s biggest employers group, said 59% of companies reported both labor shortages and difficulty in recruiting new staff. Lloyds Banking Group Plc said 43% of companies expect to boost wages by 2% or more in the the next year, the most since it started asking that question in 2018.
The findings suggest upward pressure on wages, a concern for the Bank of England as it watches for signs of an inflationary spiral. The central bank expects consumer prices to rise more than 4% by the end of this year, double its inflation target.
The surveys published Thursday showed an upbeat outlook for the broader economy, albeit one with slower growth than when Covid-19 lockdowns were first eased earlier this year.
The CBI said its reading of private-sector activity fell for the first time in five months but that it remains above the long-term average. Lloyds said U.K. businesses were the most confident since 2017 before the petrol crisis hit, with the biggest increase in confidence since April.
Those readings contrast with reports gauging sentiment among consumers and purchasing managers, which often are a more forward-looking indicator of the economy.
The pick-up in business sentiment in the Lloyds survey came despite widespread complaints about hiring difficulties and supply-chain issues. The survey was conducted Sept. 1-15 -- before concerns about a shortage of delivery drivers led to panic- buying of auto fuel.
©2021 Bloomberg L.P.