The East Midlands’ unemployment rate has fallen to its lowest point on record, new figures show. It was 3.5% for the period between September and November last year, compared to a 4.1% national average. This is the lowest level since the Office for National Statistics (ONS) began publishing regional labour market figures in April 2015, and represented the smallest proportion of the workforce being unemployed since the three months to December 2019, when the rate was 3.6%. It also marked a significant drop on the previous reporting period for August to October 2021, when the region’s unemployment rate was on par with the UK average at 4.2%. East Midlands Chamber Chief Executive, Scott Knowles, said: “This is fantastic news for the region’s labour market and sends a clear signal that the East Midlands is open for business. “It reflects our own research that indicates our region’s firms are creating jobs to meet strong demand following the effects of the pandemic. The Chamber’s latest Quarterly Economic Survey (QES) for Q4 2021 showed two-thirds of companies attempted to recruit, while a net 35% expect to increase their headcount in the first three months of 2022. “We are represented by a very diverse economy in the East Midlands but there have been some standout sectors to celebrate in recent times, such as the logistics industry that has been a major driver of job creation during the pandemic, which has accelerated pre-existing online shopping trends.” Tightening labour pool presents acute challenge for businesses While the East Midlands has one of the lowest unemployment rates for over-16s in the UK, the economic inactivity rate for people aged 16 to 64 rose from 21.02% to 22% in the most recent reporting period. UK job vacancies also soared to a record high of 1.24 million between October and December – 462,000 higher compared with the three months before the pandemic. Scott added: “Despite the positive trajectory in unemployment, businesses are still encountering major recruitment challenges in a super competitive jobs market. “The 0.8% increase in the economic inactivity rate represents a rise in the number of people who have opted out of employment, whether it’s for studying, caring or to take early retirement – with the latter being a noticeable trend during the pandemic. “This means the labour pool is tightening at a time when companies are desperately trying to fill roles to cope with demand, which will enable them to continue growing and creating more jobs for local people. “Many companies in traditional industries such as manufacturing and construction often tell us about the difficulties in replacing an ageing workforce with younger talent, and the latest QES showed that eight in 10 of those that attempted recruitment struggled to find people with the right skills. “As we await publication of the Government’s delayed Levelling Up White Paper, the wider context behind the latest ONS data illustrates the need for policymakers to understand how we can pull the right levers in order to support the local economy’s requirements.”

Omicron stalled the growth of consumer-facing businesses in December, as manufacturers benefited from easing supply chain pressure, according to the Lloyds Bank UK Recovery Tracker. Despite headwinds that resulted in an overall slowing of the pace of the UK’s economic recovery, the total number of UK sectors monitored by the Tracker reporting output growth held steady month-on-month – with growth in 10 sectors in both December and November. Activity in the tourism and recreation sector – which includes pubs, hotels, restaurants and leisure facilities – contracted for the first time in nine months in December (43.2) as concern over the Omicron virus variant impacted consumer behaviour. A reading above 50 signals output is rising, while a reading below 50 indicates contraction. UK transportation – which includes airlines, hauliers and rail operators – experienced its first loss in momentum for four months, recording its weakest output growth since August 2021 (54.3). In contrast, three of the manufacturing sectors monitored by the Tracker registered a stronger month-on-month performance in December, supported by strong demand and easing supply chain pressures. This included manufacturers of household products, which saw output growth accelerate to the fastest rate since June 2021 (56.7 in December versus 52.2 in November), manufacturers of technology equipment (60.1 vs. 53.1) and industrial goods (52.2 vs. 50.0). Business capacity issues remain, with staffing a major concern The number of firms reporting an inability to meet demand due to staff or material shortages continued to ease from its peak in September 2021. However, the level  remained elevated relative to the long-term average. In December, the number of firms reporting rising backlogs due to staff or material shortages, was around five times the long term average, compared with September when it was over six times the long term average. According to the Tracker, UK companies were more likely to report capacity challenges stemming from staff shortages than counterparts in the Eurozone. The potential for the availability of qualified candidates to remain tight, and competition for talent to translate into further wage pressures could lead to high inflation in 2022 lasting for longer in the UK than in the Eurozone, even if supply chain pressures continue to ease. All of the fourteen UK sectors monitored by the Tracker reported rising input costs in December, with wages remaining a key driver of costs – particularly for service sector businesses. Overall, UK firms were 4.3 times more likely than the long-run average to report an increase in their wage bills as businesses sought to attract and retain skilled talent, up from 3.8 times in November. At the global level, the UK remained one of the countries with the largest gap between the Tracker’s input and prices indices – signalling more acute pressure on firms’ margins. In December, the gap between the UK indices registered 15.2 index points, the joint-second highest with Italy, as Spain registered 17.2, which is well above the global benchmark of 9.5. This could fuel inflationary risks if businesses look to alleviate margin pressures through future prices rises. Jeavon Lolay, head of economics and market insight at Lloyds Bank Commercial Banking, said: “While consumer-facing businesses, like those in travel and hospitality, unsurprisingly bore the brunt of consumer concern over the Omicron variant in December, the resilience shown in other service sectors and manufacturing helped soften the impact on the economy as a whole. “Further signs of optimism were evident in data showing supply chains slowly recovering and staff numbers rising in all sectors with the exception of tourism and recreation. “However, the cost backdrop remained acute as higher energy prices and wage bills pushed up firms’ expenses. It’s no surprise that an increasing number of firms plan to raise their prices in the year ahead, indicating rising and potentially sustained domestic inflationary pressure.”

New research from Grant Thornton UK LLP’s latest Business Outlook Tracker has revealed that, prior to the implementation of ‘Plan B’ and the return of work from home guidance, hybrid working was being adopted by many mid-market firms in the East Midlands, but some businesses were still facing challenges with its implementation. The survey of mid-sized businesses found that a hybrid working approach, where people split their time between working remotely and in an office, was the most common working practice in early December with 92% of the region’s businesses working this way. Despite more than nine out of ten businesses operating in this manner, 15% said that they were not yet finding it to be effective. The research identified that the main working style challenges for those respondents adopting a hybrid working approach are:

• Managing the work of more junior staff (46%)
• Loss of culture (46%)
• Mental wellbeing (37%)
• The provision of training remotely (37%)
• Having efficient technology (37%)

Hybrid and remote working, as well as the issues it can create, are likely to remain the norm for many businesses even after Boris Johnson scrapped the government’s work from home guidance earlier this week. Sue Knight, partner and practice leader at Grant Thornton UK LLP in the Midlands, said: “Since the pandemic started, many of us have seen a significant shift in our working patterns, with remote and hybrid working becoming the de facto norm. This has been especially evident in the East Midlands, with more than 90% of the region’s businesses adopting this approach. “There have been a lot of benefits that have come with this change for both companies and their employees, such as saving costs on reduced office space and achieving a better work-life balance. However, this transition has not been easy and there have been a number of challenges to overcome – challenges that many are still trying to find the answer to. “Making hybrid working effective takes time and commitment and right now every business is on the same learning curve, trying to find out how to make their people continue to feel connected and supported, wherever they are working. As we move into the New Year, businesses need to stay agile and open to evolving in order to ensure that hybrid working operates as effectively as possible for them, which could take the form of investing in new technology or finding new ways to train, organise and co-ordinate teams.”

ICS Electrical Contractors is pleased to announce a new partnership with TFS Facilities Services (TFS), a leading Facilities Management company based in the Midlands, with clients such as Odeon and CBRE. As part of thenew partnership with TFS, ICS will be providing M&E services nationwide to their established client base, including public and private sector clients.  So, what does this mean for ICS’s clients?

• ICS’s client base now extends beyond the East Midlands, and they can serve clients throughout the UK
• They have an additional office space in Nottingham, meaning based on their location, clients have the option of meeting with ICS either in the Nottingham office or in the Leicestershire office
• They have increased the team to 6 electricians, and plan to hire 5 more electricians over the next three months, reducing wait times
• As a TFS partner, they can provide access to other services such as security gates, rolling shutter doors, HVAC, fire suppression, sanitisation and building fabric

Martin Gayle, Managing Director at TFS Facilities Services, said: “TFS had been seeking the correct partner to strengthen its Electrical Mechanical services offering greater diversity to our clients. This partnership will more than plug the gap and will ensure TFS are able to offer a fully conversant and compliant electrical service to all of its existing and prospective customers. ICS had worked closely with TFS for some time offering a great service, professional advice hence the partnership was pleasantly unavoidable” Director of ICS Electrical Contractors, Jordan Cooley, said: “This new partnership will allow ICS and the TFS Group to expand its services nationwide. Having spent over a decade in the industry, it’s a privilege to be working with a prestigious company, especially as a young entrepreneur, moving ICS to the next level. I started the business to provide an exceptional service, always within budget and on time, to commercial clients in the public and private sectors. Partnering with TFS allows us to tackle supply chain issues in the FM and mechanical & electrical industries, having a complete in-house operations team.” To find out more about TFS Facilities Services, click here.

It’s that time of year, when Business Link Magazine invites the region’s business leaders to offer up their predictions for the year ahead.  It has become something of a tradition, given that we’ve been doing this now for over 30 years. Here we speak to Karl Viner, co-owner, Fitness Options. Perhaps we might be forgiven for having to dust off the old crystal kettlebell because frankly who knows what will happen but as with any other business, we’ve learned to adapt to the challenges and to embrace the business word of the pandemic era…’pivot’. As an independent retailer, we’ve faced huge challenges and opportunities. Our retail clients typically have their own home gym, are seeking to create one or have a hybrid space, like a garage, so the challenges gyms have faced has been a huge boon to us – try finding a set of dumbbells online this summer! However, whilst we have one of the largest fitness stores in the UK, a lot of our customers are used to popping in to get to grips with the equipment we have. So whilst there have been windows of opportunity and a major upturn in footfall as soon as we re-opened, we’ve also invested heavily in a new ecommerce site which has helped us reach a wider audience and expand our offering. We’ve also seen a major upsurge in enquiries from our commercial clients, with hotels and independent gyms upgrading their facilities but the interesting one has been the demand from businesses seeking to create “wellness” facilities for their staff. Some are creating small space for workouts, whilst others are commissioning us to help design and build entire fitness facilities for their teams. We anticipate this trend will continue, as forward thinking firms see the opportunity to not only invest in their employees’ health and wellbeing but also seek to create an attractive working environment that aids retention, recruitment and the return to the office.

A detailed carbon reduction plan will be drawn up by the council as a way of slashing emissions from its activities and services. The plan will be delivered, and implemented, this year and will be an important lever in helping the council achieve its ambitious carbon neutral target by 2030. The carbon reduction plan will be based on evidence gathered from the council’s recently published greenhouse gas report which set out where its emissions are most prevalent. The report showed that 54% of the council’s emissions are from its electricity use; both in buildings and from highway equipment and lighting, with 18% due to heating, 13% from running of fleet vehicles, the reminder caused by staff business travel and transmission losses. The county council’s Environment Ambassador, Cllr Mike Adams, has welcomed the creation of a carbon reduction plan describing it as a “game-changer.” Cllr Adams said: “It is good news that we are now in the process of drawing up a carbon reduction plan; it is going to be a game-changer in our ambition to become net zero in all of our activities by 2030. “Producing our greenhouse gas report was the first step to getting our plan up-and-running  – we couldn’t go into this important project without getting the facts right about the origins of our emissions. “We are already ahead of time with some of the elements likely to be in this plan, for example, we have switched the majority of our highways lighting to LEDs and we are now moving our electricity supply to a green tariff. “We are serious about doing our bit to mitigate the effects of climate change in Nottinghamshire and our carbon reduction plan will be an important blueprint for our work.” Nottinghamshire County Council committed to become carbon neutral by 2030 after it declared a climate emergency last May.