With the last few years serving as an excellent plot-line for an end-of-world disaster film, someone stepping out of a time capsule right now might think the UK was receiving some kind of biblical judgement. Sure, the virus hit the whole world, with some places affected far worse than Britain, but throw in Brexit and a mass departure of skilled European workers and you’ve got a nation of confused souls wondering where the good times went. Is this a hex cast by the European Commission? Are we in some kind of downward spiral, or is this simply the final chaotic moment before the storm clears?
How it could get worse
Irrespective of labour shortages in positions such as HGV drivers across Europe, the UK may also be seeing structural changes to its supply chain that will affect distribution channels permanently. Ian Wright of the Food and Drink Federation (FDF) says that previously, ‘the UK shopper and consumer could have previously expected just about any product they want to be on the [supermarket] shelf or in the restaurant’. ‘That’s over,’ he states, ‘And I don’t think it’s coming back.’ While stressing that the UK supply chain is ‘resilient’ and will respond well to challenge, he explains that one of the main factors in the shortage is that ‘qualified HGV drivers have gone into being distribution drivers for Tesco and Amazon, because they’re nicer jobs, they don’t require you to get up at 4am and they’re better paid’. ‘That is a structural change that won’t reverse itself,’ he adds.
The UK used to employ the ‘just-in-time’ system, whereby food and drink was delivered as close as possible to when it was needed. That system may never return. We may, as consumers, enjoy fewer luxuries than we previously knew. In the hectic times leading up to Christmas, these changes are likely to be felt much more acutely, as empty shelves become an increasingly common sight.
The Sisyphus of modern times
Perhaps the myth of Sisyphus was more than a myth? Perhaps the UK is on course to drag boulder after boulder up the stony hill of modern times, falling ever behind our European counterparts? It seemed for a time that normal had been reestablished, that the isolated troubles of Covid had dissipated, finally making way for blue skies. How foolish we were — clearly, the gods aren’t done with us yet.
Indeed, if Mr Wright is as correct as his name suggests, then the labour shortage will not be ‘patched up’ anytime soon. Alan Jenkins of Black Robin Exhibits comments, ‘Unfortunately, the sector cannot bank on the arrival of scores of new workers. Yes, labour shortages mean widespread availability of work, but if those same work conditions that drove them away in the first place don’t change, the gaps won’t be filled.’ There is not likely to be a sharp influx of foreign workers seeking the same jobs abandoned by their predecessors, and the government’s official stance remains that sectors will simply have to make understaffed positions more palatable to Britons.
Downward Spiral – Stunted recovery
Our European detractors are no doubt howling in laughter, chalking this new wave of misery down to Britain’s reckless departure from the EU, believing that we deserve every ounce of bad karma that comes our way. But while the UK economy has experienced a stunted recovery, falling behind other European countries due to post-Brexit trade issues, it has been estimated that towards the end of the year, growth will accelerate to rival the United States, making Britain the world’s joint fastest growing economy. These predictions come with serious caveats, as Paris think-tank OECD (Organisation for Economic Co-operation and Development) warns of ‘deep economic scarring’ following Britain’s exit from the EU.
The UK is a service economy — 79% of its GDP is derived from this sector, and three quarters of Britain’s workers are employed by it. This means that thwarted distribution channels are a huge hurdle in the country’s recovery, but it also means that once some stability returns, the economy’s growth should accelerate much more.
Downward Spiral – Wavering consumer confidence
Another factor that has allegedly contributed to our lagging recovery is wavering consumer confidence. Goods shortages and rising inflation have made British households uncertain about their financial position. While no doubt keen to restart their lives, British people are nonetheless questioning whether or not life will get easier anytime soon as shortages force supermarkets to raise prices by 5%. Add to that a fuel crisis, and many UK citizens will be shacked up at home, engaging in wilful lockdown until the madness abates.
It’s not just food and drink either. Transport costs, energy bills and services like haircuts are all on the rise, making consumers wary at the prospect of spending money. If these prices don’t level off soon, recovery may tarry even further, held back by continued consumer reluctance.
Downward Spiral – Coincidence?
Economist Ed Conway is calling this moment a ‘perfect storm’ — an aggregation of multiple coincident factors that make for chaotic, but temporary, turbulence. Rather than a downward descent from which there can be no return, this period is, Conway claims, a final clamp around the UK economy, the release of which will spark massive new growth. Predictions, as always, vary from disastrous to highly optimistic, but most are agreed that the UK is faced with temporary setbacks to an otherwise hopeful future far away from any perceived downward spiral.
Many of us seem to have grown accustomed with crises, almost expecting each newsfeed refresh click to reveal a new hardship. While this may be a bad omen, it may also be a positive sign, showing how quickly we can accept and adapt to a new set of circumstances. British business owners surveyed earlier this year demonstrated a level of optimism not matched since 2016, indicating that the UK economy may be more resilient than it currently appears. Ross Pike of Bournemouth-based exhibition contractor Quadrant2Design comments, ‘While there is certainly no shortage of reasons to angst over the future, our company is already seeing a large influx of new business over recent months. This bodes very well, not just for us, but for the economy at large, as this kind of boosted confidence is necessary for real growth.’ Try as it might, 2021 has failed thus far to fully extinguish British optimism, and if we can get through this period in one piece, 2022 should have little reason to scare us.
Author Bio
Theo Reilly is an independent writer and multilingual translator whose goal is to counteract stale writing in business blogs and about teamwork within business. Theo has particular interest in business and marketing-related matters surrounding the online world, web design, exhibitions and events.