October 2021

About Logistics UK

Logistics UK is one of Britain’s largest business groups and the only one providing a voice for the entirety of the UK’s logistics sector. Our role, on behalf of over 18,000 members, is to enhance the safety, efficiency and sustainability of freight movement throughout the supply chain, across all transport modes. Logistics UK members operate over 200,000 goods vehicles - almost half the UK fleet - and some one million liveried vans. In addition, they consign over 90 per cent of the freight moved by rail and over 70 per cent of sea and air freight.

Response to the inquiry

• What is the extent and nature of labour shortages currently being experienced in the food supply chain?

The logistics sector is the backbone of UK economy and plays a vital role in food supply chains. It has been well documented that the sector has labour shortages across all areas of employment but the some of the hardest roles to fill are HGV drivers and fitters/mechanics/technicians.

The current estimates of the HGV driver shortage range from 60,000 to 100,000, with a central estimate of around 76,000.

Whilst Logistics UK does not have specific data on shortages in food supply chains our Logistics Performance tracker (September 2021) identifies how shortages are impacting the sector as a whole:

• 96% of UK logistics businesses are now reporting problems recruiting HGV drivers
• 34.3% of Logistics UK members reported a “severe” or “very severe” problem filling fitter/mechanic/technician roles.
• 26.7% of Logistics UK members reported “no problem” filling warehouse staff roles.
• 30.4% of Logistics UK members reported “no problem” filling forklift drivers.

According to ONS vacancies data (provided by the online job search engine, Adzuna for 10 September, the number of transport/logistics/warehouse online job adverts was double the same period last year. The average across all sectors is job adverts running at just over twice the rate as the same period last year.

• What are the factors driving labour shortages in the food supply chain?

Food supply chains are being impacted by the wider problems in the logistics sector including the acute shortage of HGV drivers. This shortage is caused by various factors including an ageing workforce (the average age of a HGV driver is over 50) and shortage of driving tests at DVSA preventing new drivers entering the workforce and a loss of EU drivers following the end of the transition period.

As a result of DVSA’s suspension of testing due to Covid safety rules in 2020 there is now a backlog of 45,000 tests. Whilst DVSA is taking measures to increase testing availability it is unlikely that the agency will be able to catch up with the backlog until the Spring 2022.

Due to Brexit some EU drivers left the UK; the Annual Population Survey statistics show that 16,000 EU drivers left the industry in the year to March 2021. In Q2 2021 compared to Q2 2019 there were 13,500 fewer EU HGV drivers working in logistics year on year.

To skill the new logistics workforce greater attention should be focused on accessing training for roles within the logistics sector. In recent years Government’s education policy has been predominately aimed at level 3 and above but 67% of jobs in the logistics sector are categorised as level 2 or below; the national average is 40%.

Whilst Logistics UK welcomes recent changes such as £10million for new level 2 bootcamps to fully qualify 4,000 new HGV drivers further policy changes are needed to provide the work force for the future. Currently the apprenticeship scheme is not meeting its potential. During the 2019/20 financial year, only 15% of apprenticeship levy paying employers fully utilised the funds available to them. The number of transport apprenticeships started in the last five years is less than half the original 30,000 target set in 2015. In addition, the average funding per apprenticeship at level 2 – across all subjects – was £7,743 (and lower for those in transport), whereas across level 3 apprenticeships it is £12,119.

• What other issues are affecting the food supply chain?

Whilst Logistics UK does not have specific data on shortages in food supply chains our Logistics Performance tracker (September 2021) identifies how shortages are impacting the sector as a whole. Our data shows that disruption to the supply chain has significantly changed in September compared with May 2021.

66% of respondents stated that costs to transport goods had increased in September, compared with 46% in May, while 36% of respondents stated that overall freight volumes had decreased in September, compared with 22% in May (due to driver shortage and Brexit impacts).

However, some (35%) reported that volumes also increased in September, compared with 27% in May, due to rising demand.

A shortage of drivers is also causing a build-up of containers in major ports such as Felixstowe.

• What impact will the timetable for introducing physical checks at the border on food and live animal imports from the EU have on the current issues being experienced by the UK food supply chain?

The decision to delay the introduction of sanitary and phytosanitary requirements on imports from the EU was taken to acknowledge the supply chain pressures businesses are facing, for instance in relation to the driver shortage and increasing ocean freight capacity concerns. Whilst the announcement was met with relief in some parts of the industry, it is important to acknowledge that successive delays also penalise those companies that were diligent and invested time and money in their readiness plans. It is now crucial to make the best possible use of the extra time to complete the delivery of border facilities for physical checks and to clarify the exact processes at a very granular level (eg, driver information process and driver routing when a vehicle is selected for physical checks). Engagement with EU trading partners remains crucial to make a success of the upcoming stages of the import timetable, as a significant share of the new formalities will require action on the part of EU exporters, eg. arranging for certification of products of animal origin and plant products moved from the EU to the UK.

The introduction of full import controls on agrifood products represents a vast change in how supply chains are organised. It is going to be demanding on traders and transport companies. To face this challenge in the best possible conditions, it is urgent that Government addresses the different aspects of the driver shortage now, in order to minimise the supply chain pressures at the time of the introduction of physical checks on imports in July 2022.

• What measures has the Government taken to alleviate the problems being faced by the food supply chain this year? To what extent have they been successful?

Logistics UK had been calling for temporary visas for HGV drivers to fill the need for extra drivers in the short term. Whilst we are pleased Government has recognised the need for short term visas the numbers are not sufficient (only 4,700 for the food sector) and the visas offered by the Government are only for three months and the short time span is potentially one of the contributary factors in fewer applications for them. There is less appeal for freight HGV drivers to move to the UK for a matter of weeks before returning home again.

• Does the Government need to take further steps to support the food supply chain?

Food supply chains are impacted by wider shortages in the logistics sector so it is vital that the Government looks at how to support logistics as a whole. As part of this the Government needs to acknowledge the role of ‘lower skilled jobs’ in the food supply chain and wider logistics sector and how it can support increased provision in driver facilities.

Within the wider logistics sector the greatest proportion of jobs are level 2, which is low to middle skilled (41.7%), followed by low skilled (26.6%). The proportion of logistics jobs considered to be low and low-middle skilled is greater than the national average, where they represent only 9.2% and 31.4% respectively of all jobs in the economy. The logistics sector would welcome the National Skills Fund being expanded to offer level 2 qualifications and not be limited to level 3 courses.

Examples of level 2 roles in logistics are: HGV drivers; forklift drivers; warehouse operatives and mechanics/fitters/technicians. The Government has taken action for HGV driving by creating the Skills Bootcamps in HGV Driving, but the remaining roles, all of which have problems in recruitment, though not as severe as HGV drivers, would benefit from easier access to training.

Whilst it is important to recruit new people into logistics it is also vital to keep talent within the sector so it is vital to not to lose sight of the importance of driver facilities, which are necessary for welfare needs and the safe operation of the network.  It is in all our interests for HGV driving to be an attractive and respected profession and it is vital that there are adequate facilities for drivers to take their breaks and rest periods, as required by regulations. The provision of adequate stopping places provides benefits for drivers, operators, the community and the economy.  At present, the negative images and experiences related to driver facilities are an obstacle for many people who might otherwise be interested in the logistics profession – most notably female drivers who are chronically under-represented in the profession. 

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