Small firms cannot fill their situations vacant

The situations vacant signs have never been so plentiful. Shortages of staff have retailers, restaurateurs, hoteliers and tourism-related businesses searching for ways to fill positions which not so long ago would have attracted a host of applicants.

The high-tech skills shortage has been well documented. But now the economic boom has meant that many employers are also struggling to fill lower-tech positions. The usual staff pool for these businesses of school leavers, married women and people returning to work has dried up.

Increasingly school-leavers are opting for further education, while married women and others returning to the workforce now have many options when seeking work, many of them provided by multinational firms offering relatively attractive salaries.

This has left many smaller companies and service businesses struggling to fill positions, with the problem compounded by the lack of skilled employees.

"They're pulling their hair and wracking their brains" for a solution, said Mr Frank Mulcahy, chief executive of the Irish Small and Medium Enterprises Association (ISME).

Some jobs are still not filled after being advertised for more than a year. "It's a huge problem. The indigenous sector has a general labour and skills shortage. From an employer's point of view, it's a period of full employment and there's a severe supplyside bottleneck," said Mr Mulcahy.

The shortage is attributed to a number of economic and social factors, said Ms Grainne O'Malley, press officer for CERT, the State tourism training agency.

"There are a number of causes, mainly the phenomenal growth in industry, employment and the economy overall. The traditional source of labour is now reducing and industry is recruiting much more aggressively. There were never more jobs than now but we're in a shrinking labour market," she said.

Even taking the live register figures, unemployment here has fallen from the top of the EU league five years ago to below the average now, at just more than 9 per cent of the labour force. And even these figures are questioned by many in the sector, with the less frequent labour-force survey showing less than 200,000 people unemployed and seeking work.

"The live register is a myth," said Mr Mulcahy. "It's totally exaggerated in terms of the number of people supposedly available for jobs. We're competing with the black economy."

There are no accurate figures available for the size of the black economy. But some economists have estimated that it accounts for up to 8 per cent of activity in the economy. And a key difficulty is that many unemployed people

particularly those with families do not find it financially attractive to move back into jobs because of the interplay of the tax and social welfare systems.

In a desperate effort to fill jobs, businesses are establishing partnerships with government agencies and community groups, launching aggressive recruitment campaigns and conducting employer surveys.

Partnerships are seen as one of the most immediate solutions to this long-term issue. Last month, ISME announced that "400 member companies have offered to take people off the live register by working with the Department of Social Community and Family Affairs and FAS and pairing people with companies," said Mr Mulcahy.

Under new Government rules, those refusing to take work after a certain period are liable to be struck off the live register.

FAS is undertaking the administration of the partnership scheme.

The Retail Grocery, Dairy & Allied Trades' Association (RGDATA), which represents many of the independent retailers, is also working with the training and employment authority.

"We've been working with FAS trying to address this problem. All retail sectors are facing this problem. We're promoting the type of careers available to school leavers and to more mature people coming back to work. The retail sector offers them flexibility," said marketing director, Mrs Louise Carroll.

Recruitment campaigns are seen as another proactive solution to the shortage of qualified staff.

"We're undertaking our biggest recruitment campaign, targeting schools and people who are looking to return to work. We're looking at all options, including the UK, for people who have trained through CERT and want to return to Ireland," said Ms O'Malley

"We're targeting, recruiting and training a large number of people on the live register. We're working directly with community groups and having direct promotions in local areas. We've had great responses and we're looking to recruit 3,000 on full-time courses," said Ms O'Malley

Member surveys conducted by RGDATA, ISME and CERT have all shown that it is an industry-wide problem and many believe it is exacerbated by the arrival of multinationals to Ireland.

Organisations representing the affected sectors are putting pressure on the Government to revise its industrial policies.

"We said to the Government last week that we should be more selective and bring in companies that are working with local suppliers rather than against them. Multinationals are having a negative effect on indigenous industry at this stage. We recognise the value of their contribution, but we're now in a new environment and it's time to be reflective on that and reflect it in policy," said Mr Mulcahy.

Many retailers are blaming multinationals for the labour shortage. "The multinationals coming in here have been mopping up whatever skilled labour is available, from our Irish-owned companies, the best and the most skilled. It's very difficult for the indigenous sector to compete," said Mr Mulcahy.

"In the indigenous sector, the typical wage is £5 an hour for semiskilled and skilled workers. In some cases, the multinationals are offering more. They're offering a higher level of expertise, and wages reflect that," said Mr Mulcahy.

Other disincentives to working in this traditionally low-wage sector include tax structure. "Married women find the tax payment makes returning to work an economic impossibility and the long-term unemployed make little more than what they receive on the dole," says Mrs Carroll.

Some of these issues may be addressed in the forthcoming Budget, where the Government looks set to direct tax relief at the lower paid, with the specific aim of increasing labour supply. But unless economic growth slows sharply, the jobs vacant signs are likely to remain in place.