British households are facing a hard winter as cost pressures due to a lack of delivery drivers and bureaucracy at the borders make further price increases “inevitable”, warn retailers. Tim Wallace writes.
The British Retail Consortium (BRC) said there were “clear signs” that the shortage of freight forwarders, combined with rising transportation costs and raw material costs, was starting to affect store prices.
Food price inflation returned in September for the first time in six months, according to the BRC, an early sign that supply problems were starting to take hold.
Goods such as do-it-yourself and gardening tools, furniture and electrical appliances are increasing particularly strongly.
Overall, shop prices rose by 0.1 percent between August and September, but still fell compared to the same month last year.
Helen Dickinson, CEO of the BRC, said: “It is inevitable that prices will continue to rise. Supply chains have recently been put to the test with CO2 and truck bottlenecks.
“The government needs to find a long-term solution to the truck driver shortage by expanding the scope and scope of the new foreign driver visa system so that they can fill in the gaps while new UK drivers are trained.
“Without this, these additional burdens on what is already a precarious retail environment will affect UK consumers and the prices they pay for the goods they want and need.”
Currently 5,000 foreign truckers are allowed to work in the UK under the UK temporary visa introduced this week by the government.
The trucking crisis is already having a critical impact on petrol stations across the UK as the lack of drivers combined with panic buying is causing the pumps to dry up at petrol stations.
Prices soared this week to over 135p a liter, up from 113p a year ago and the highest since September 2013.
Diesel is close to 138 pence, its highest level since early 2014.
According to a survey by the Recruitment and Employment Confederation (REC), nearly six in ten companies suffer from a shortage of candidates for vacancies.
For those looking for permanent employees, 13 percent have a driver shortage, with 17 percent of companies requiring temporary workers
Neil Carberry, CEO of REC, said solving the driver shortage is more complex than simply relaxing visa requirements.
He said, “Yes, we need a visa system that addresses business needs, but the answers lie in policies that will take a long time to implement.”
This also included “tackling youth unemployment by creating opportunities for jobs that we see with bottlenecks,” he added.
5 things to get the day off to a good start
1) Pound plunges on spike in inflation and US debt crisis The pound sterling is slipping and the FTSE 250 falls 2 percent after the cost of government borrowing hit 1 percent for the first time since March 2020 due to fears of interest rate hikes.
2) Stelios loses its grip on easyJet after 26 years Sir Stelios and his family can no longer veto important decisions made by the airline’s board of directors after his stake fell to 15.3
3) Euan Blair valued at £ 160 million after his company’s record investment Multiverse is valued at nearly £ 650m after US investors
4) BT is on trial for landline overload The telecommunications giant faces the prospect of paying £ 500 to more than 2 million customers if it loses a class action lawsuit.
5) Wise shares fall after founder fined UK tax breach Kristo Kaarman says he is now devoting more time to “keeping his personal administration in order”.
What happened overnight
Asian stocks fell on Wednesday as rising bond yields fueled inflation fears and deepened China Evergrande Group’s debt crisis.
MSCI Inc.’s Asian stock valuation saw its sharpest decline in nearly six weeks – and is heading for its first quarterly decline in six weeks. Japan fell when two candidates ran a runoff election for the ruling party’s leader. China slipped on the worsening debt crisis at the China Evergrande Group.
US futures rose after the S&P 500 posted its sharpest drop since May, with concerns over the Washington debt ceiling impasse adding to investor fears. The Nasdaq 100 fell the most since March as technology stocks underperformed amid rising government bond yields. European treaties climbed. Treasuries stabilized after the 30-year bond yield rose nearly 10 basis points. Oil gave way and the dollar slipped.
- Companies: Ashmore, genus (Full year); Berkeley (Trade update)
- Business: Services PMI (UNITED KINGDOM), Retail sales (EU), Unemployment rate (US), Services and composite PMI (EU, USA)