Businesses have spent £1.2bn on temporary hires over the past year as a means of recovering from the disruption caused by Covid-19, according to The Open University Business Barometer.
The Open University revealed that one in four businesses have made redundancies during the pandemic, with temporary hires being brought in to close the skills cap which the university believes to be unsustainable.
Despite more than half (52%) of senior leaders stating cutting costs is the priority for their business, organisations have spent £6bn overall on inflated salaries, temporary staffing, recruitment fees and training recently.
Viren Patel, corporate director at The Open University, said: ‘‘It’s unsurprising that after such a challenging year, business leaders are looking for quick fixes to talent shortages.
‘‘And while hiring in short-term solutions to skills vacancies may solve the immediate issue, we know that further change is coming, and this cycle of hiring and firing will prove expensive and unsustainable.’’
He added: ‘‘‘The massive increase in available workers in the labour market is not increasing the supply of the skills that businesses most need to help them respond to and recover from the crisis, instead, the skills that are in short supply have become more valuable as organisations chase a pool of talent that was already very low before the crisis began.
‘‘Organisations that instead adopt a “grow your own” approach to the roles they need, and re-skill colleagues into relevant roles, will find themselves able to adapt to further challenges and uncertainties more quickly than those buying them in, whilst cutting costs.’’