A wave of early retirement following the pandemic is the “biggest cause of labour shortages” across the UK, according to the House of Lords Economic Affairs Committee. The committee said the labour outlook for the UK was “bleak” and it was critical for the Government to consider how inactivity across the labour market can be addressed to help support the economy.
A report by the influential committee has examined the jump in economic inactivity – the number of people not in work or looking for work – and rising vacancies since 2020. Economic activity has increased by 565,000 people since the start of the pandemic, according to the analysis.
The report highlighted that retirement, increased sickness, changes to migration and the UK’s aging population have all contributed to the current tightness in the labour market. However, Lord Bridges of Headley, chair of the committee, told the PA news agency that the report, titled Where Have All The Workers Gone, found that the pandemic seemed to spark increased early retirement.
