Recruitment difficulties stand at near-record highs for the manufacturing and services sector in the fourth quarter of 2018, according to survey data from the British Chambers of Commerce.

The survey of more than 6,000 firms, found that labour shortages have risen in the UK as 81% of manufacturers that tried to recruit reported difficulties in finding the right staff, the joint highest level since the survey began in 1989. In the services sector, the level (70%) hovers close to the record high recorded in the previous quarter (72%).

In the services sector, a key driver of UK economic growth, the percentage of firms reporting an increase in domestic sales and orders weakened to their lowest level in two years. Domestic activity among UK manufacturers also moderated in the quarter.

Within the manufacturing sector, the percentage of firms attempting to recruit remained unchanged at 67%. In the services sector, the percentage of firms looking to recruit rose to 50% - of those, 70% had recruitment difficulties.

“The UK economy ended 2018 stuck in a weak holding pattern, with stagnating levels of growth and business confidence as a result of heightened Brexit uncertainty and other economic pressures,” the report from British Chambers of Commerce stated.

Adam Marshall, Director General of the British Chambers of Commerce, commented, “Brexit is hoovering up all of government’s attention and resources, but it’s far from the only cause of uncertainty. Given the magnitude of the recruitment difficulties faced by firms clear across the UK, business concerns about the government’s recent blueprint for future immigration rules must be taken seriously – and companies must be able to access skills at all levels without heavy costs or bureaucracy.”

In December 2018, the Home Office published plans for a new post-Brexit, skills-based immigration system in a white paper report.