A less merry Christmas awaits Britain
Imagine a scenario where a restaurant chain, famous for chicken dishes, is forced to shut down dozens of its outlets due to supply shortage. Food shops too are trimming their menus and superstores, leaving some of their shelves partly empty because they are unable to replenish their depleted stocks. It’s real, and it’s happening in Britain.
These breakdowns in supply chains are not only affecting small or medium business entities, but big brand multinationals too. Nando’s has run out of chicken, McDonald’s has stopped selling milkshakes, and superstores have been struggling with dairy products. The latest global giant joining the list of businesses struggling with supply chain crisis is Coca-Cola, which has reported shortage of aluminium cans. Coca-Cola’s trouble is reported to have spread beyond the UK and is affecting bottling plants in Europe. The reason behind the crisis is shortage of truckers known as HGV (Heavy Goods Vehicle) drivers. It doesn’t matter whether someone drinks milk or beer—everyone is somehow affected by the supply crunch.
A BBC report quoted one HGV driver saying that he had a 40 percent rise in his pay package due to the crisis in the haulage industry. Supermarkets such as Tesco and Aldi have been offering bonuses and other incentives to boost recruitment, but the labour squeeze continues. The HGV driver shortage is also affecting civic services provided by the local authorities. The Independent reported on Friday that bin collection within 24 local councils had been disrupted due to self-isolation rules and a lack of workers to drive the lorries. A survey by the Road Haulage Association (RHA) estimates that there is a shortage of about 100,000 drivers.
One of the main reasons behind this shortage is Brexit. Many Eastern European drivers who left the UK following its exit from the European Union have not returned. The ongoing supply shortages, once again, has stoked the political debate over the so-called Brexit dividend. Expressing frustration and anger, some pro-EU activists are calling for a rethink about the future. However, it must be noted that the Covid-19 pandemic has caused further aggravation.
The RHA, however, blamed a few other issues, too, for the shortage of drivers. One of those is the historical problem in recruitment, work-life balance, and the high cost of training HGV drivers.
It added that the ongoing global pandemic also had some impacts as the licensing authority paused all licence qualifying tests. There is a huge backlog of driving tests, including the HGV ones. The isolation and quarantine rules, too, caused unpredictable and sudden abstentions from duties. These rules, however, have been gradually easing. Realising the seriousness of the shortage, the government has now begun consultations for changing the law to make licencing easier.
Recently, lobby groups for the retail and transport industries jointly wrote to UK Business Secretary Kwasi Kwarteng, warning that the impact on supply chains was getting worse, and urged for allowing European drivers on temporary work visas. Logistics UK, a representative body for freight firms, and the British Retail Consortium (BRC) said that while Brexit and Covid-19 had caused lorry drivers to leave the UK, a temporary visa could lure them back. But the business secretary insisted that the industry should strive to tackle the shortage with local recruits, which some observers compared to rubbing salt on the wound.
Latest groups joining in the call for urgent actions to tackle the shortage of HGV drivers are leaders of the Local Government Association (LGA) and medical professionals. LGA leaders have called on Home Secretary Priti Patel to relax immigration rules for heavy goods vehicle drivers in order to ease the disruption. They have also pointed out that as the private sector is raising the drivers’ wage as a quick fix to overcome their business challenges, the public sector is finding it even harder to maintain its level of service. On Saturday, one of the UK’s largest suppliers of seasonal flu vaccines said the flu jab delay of up to two weeks was due to driver shortage. Doctors have expressed fear that the delay could result in a surge in flu cases this year.
This is the second shortage of workers affecting the British economy as it comes amid a crisis in the farming sector due to the lack of seasonal workers’ availability. Before Brexit, Eastern Europe was the main source of Britain’s seasonal workers. Some farmers were forced to let some of their crops rot in the field, and a few others opened up their gates to allow the public to pick their produce free.
As companies across the retail, transport and hospitality sectors are struggling to deal with these shortages, both the CEO of the frozen food retail chain Iceland Foods Ltd and wine manufacturer Accolade Wines have warned that Christmas could be a little less merry this year. Explaining the hurdle, some business leaders say that the retail industry usually starts stocking for Christmas in September, but they are now getting much less of the required supply. Analysts warn that extra costs in getting supplies would certainly push up the prices. Businesses say that even if the government immediately allows foreign drivers, recruiting them would take four to six weeks, which means a solution to the UK’s supply chain crisis would not happen overnight. Never before people in the UK have realised that everything at their home is likely to have been on a truck at some point, and how skills shortage can affect them all.