There are 1.5 million unemployed people in the UK today, 1.2 million job vacancies, and a swath of employers experiencing skill shortages. So, where have all the people gone?

The answer isn’t as straightforward as you might think.

Yes, foreign nationals previously working in the UK returned home during the pandemic. Many of these people haven’t returned and others outside of the European Economic Area (EEC) are struggling to get visas. While some eligibility rules have been relaxed for the latter, if you’re not considered a specialist talent, skilled or health and care worker, then gaining access to the UK employment market isn’t always easy.

Yes, there has been a boom in people starting businesses of their own. According to the online experts smallbusiness.co.uk, an additional 85,000 new UK businesses were created in 2020 compared to 2019. That’s the highest percentage growth since 2011. If you want to test that theory, just try finding a high street bank willing to accept you as a new business customer. It’s a long a painful process.

While there will always be jobs and contracts less favoured even by the unemployed – abattoir worker, warehouse packer, fruit picker – there’s no denying that the pandemic pushed many businesses into places they hadn’t planned to go.

For most – online became a necessity rather than something on the strategic horizon. So, yes, we simply don’t have enough analysts, digital marketers, and data scientists to go around. But guess what, when talent gets hired into these roles, the experience doesn’t always match up to expectations.

We’ve spoken to departing employees who were promised interesting work on customer playbooks and data modelling, only to find that they are punching numbers into spreadsheets. Very quickly work of this kind becomes just as unfavoured. This expectation gap needs careful, honest management if employers want to attract and keep good people.

But are these just symptoms of a more profound change in the employment market? Elisa Nardi, Founder and CEO of consulting and professional development firm Notebook Mentor thinks so.

“Rather than thinking about the perennial problem of change in the workplace, think of it more as a hiatus,” says Nardi. Because a “pause or break in the continuity of the world of work, is exactly what has happened on a global scale over the past 20 months. And this hiatus is at the root of several problems that need fixing.”

Firstly, people broke work and personal habits they’d never broken before. They say it takes twelve weeks of focused effort to shift or change a habit. The pandemic forced 12 months of change on everyone. Before Covid, people waited for employers to tell them what to do, how to work, where to show up. Today, employees are lost somewhere between waiting for direction and choosing to do their own thing.

This has inevitably breached what’s known as the psychological contract between employee and employer. Where there were clear beliefs about the relationship previously with clear expectations and obligations, this hiatus has muddied the waters. As people struggle to rediscover continuity, there remains a gap between employers who are trying to present jobs attractively and with flexibility, and prospective employees wondering whether what’s on offer, is really for them.

Equally, Nardi argues, think about young talent starting out. “First-time job seekers tell us that they find the jobs market confusing. Thirty years ago, the majority found employment in 15-20 key job families – finance, marketing, operations, engineering. Today there are literally thousands. People setting out, or even those in their second or third jobs, either don’t know where to start or are struggling to showcase and match their skills and experience, with what’s on offer”.

“Education hasn’t really caught up with the complexity of the job market”, says Nardi. “Today young people ‘test out’ a variety of jobs, rather than setting out on a career path. It’s not so much a skills gap, as a disconnect between what people think they want and what employers need. Somewhere along the way, this will smooth itself out but until then a landscape of trial-and-error creates volatility.”

At the other end of the age spectrum, as the population ages, more people are retiring or at least downsizing to jobs that are less demanding. But the pandemic created a moment in time when many more people chose to press the ‘pause’ button. Covid became a time for re-evaluating what you want from work and life, and those re-evaluations aren’t necessarily in line with the needs of businesses that are surviving or playing catch-up. While financial concerns will ultimately win out over a desire to ponder ‘what could be’ we are still very much in the grip of deep reflection. And the skilled, in-demand workers, are as much a part of this as anyone.

We know people are out there. The best thing employers can do is to encourage thoughtful conversation between themselves, their employees, and prospects. Talking about things in a structured and productive way will help everyone reconnect and find their new normal.

“We need a new psychological contract that offers individualisation and flexibility” argues Nardi. “But equally employers need to set rules and be clear about obligations”. Without this, it will be hard to create the necessary trust required to bring that continuity back to the workplace.


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