The chemical supply chain plays a critical role in society, providing countless products on which people, organisations and governments rely on.
As those in the biofuels sector will be aware, the industry has faced significant challenges in recent years, including the impact of Brexit and the skills gap.
Tim Doggett, CEO of the Chemical Business Association (CBA), discusses these issues and explains the initiatives taking place to address them.
Vital role of industry
Without the chemical supply chain, everyday lives would grind to a halt. As over 97% of manufactured goods, globally, contain a chemical input, disruption to the supply chain can prevent manufacturers from producing and supplying the products that everyone relies on.
With biofuels alone, disruption would cause tremendous problems for sectors like energy and transportation, while affecting the myriad of other industries that rely on its by-products.
In this sense, the chemical supply chain is, undeniably, vital for everyday life and it would be impossible to imagine a functioning modern society and economy without it.
The legacy of Brexit
One of the major challenges for the UK chemical supply chain has been Brexit, which brought new customs formalities and procedures and forced businesses to adopt new systems and approaches.
Adapting has taken time and resources and resulted in delays and additional costs. In some circumstances, businesses have had to open entities in or even completely relocate to the EU.
Leaving the European Union Customs Union post-Brexit meant significant changes in the supply chain, in particular the ability to supply on a ‘just in time’ basis, which has become more of a ‘just in case’ approach, with businesses shipping larger volumes and holding more stock, often speculatively and which impacts cash flow and increases storage costs.
Additionally, Brexit means that UK and EU laws and regulations have begun to diverge.
The chemical supply chain is particularly affected by there now being EU and UK REACH, and the continued uncertainty around the latter.
As the gap between EU and UK regulations widens, more challenges are anticipated.
For example, chemicals that are permitted for use in the UK may be prohibited in the EU, or vice-versa, creating considerable problems for manufacturers and potentially preventing some products from being made at all.
Skills shortages
Another key challenge is to attract and retain talent to ensure the chemical supply chain has a sustainable skills pipeline.
In an industry that spans such a broad spectrum of operations, a wide range of skills are required. However, the sector currently faces a future where those skills may be in short supply.
The reasons for this are two-fold – many of those with experience and skills are close to retirement while potential employees are not choosing to join the industry.
Negative perceptions about the sector put people off, while ignorance of its career opportunities and valuable contributions to society stifles its appeal to younger generations.
To make matters worse, a ‘war on talent’ means companies are losing existing talent to competitors and even other industries.
Addressing the challenges
Though the challenges are significant, businesses and the industry organisations that support them are both steadfast and proactive in addressing them.
With regards to UK REACH, industry organisations are using their positions to assist their members and the sector at large.
For example, they have played a key role in lobbying the government about the regulation’s practicality and workability, and the duplication of testing and costs.
With persistence, this lobbying eventually led the Department for Environment, Food and Rural Affairs (DEFRA) to agree to consult on extending deadlines which has since come into effect, while exploring an alternative model that will be more practical and reduce duplications in costs and testing for companies. This work remains ongoing and key stakeholders continue to sit on or provide specialist advice to the various working groups seeking a solution, as well as providing members with one-to-one advice services, training and resources.
As for attracting new talent, one of the main hurdles is changing the negative perceptions of the industry.
For this to happen, chemical companies must counter stereotypes and promote the valuable contributions of their business and the industry at large. Furthermore, to be seen as an employer of choice, young people need greater awareness of the various careers available within the sector, the routes into them and the long-term opportunities they offer.
Keeping hold of talent is equally as important and to improve retention, employees need career development opportunities. This requires the employers to provide vocational training, skills programmes and continuous learning options.
Today, there are various initiatives in place to improve recruitment and retention.
The CBA People & Skills Hub, for example, unites stakeholders from across the entire chemical supply chain, creating an active network that includes everyone from aspiring professionals and education partners to thought leaders and sector experts.
This venture not only allows companies to engage and exchange knowledge with talented individuals, it also offers skills development and career advancement opportunities through its inclusive range of resources, outreach programmes and networking opportunities.
Similarly, the CBA Future Council allows young industry professionals to share their knowledge and experience.
Set up to improve understanding of the chemical supply chain, it holds events where members can educate, share skills and raise awareness of the sector. The CBA Young Person’s Award, meanwhile, recognises outstanding contributions while raising the profile of the industry.
Generation Logistics, supported by the Department for Transport, is another industry initiative that aims to attract more young people by promoting and extending opportunities to enter the logistics industry.
These include entry-level pathways and graduate programmes. Launched just over a year ago, it has already reached an audience exceeding 415 million, with 600,000 website visits and over 4 million interactions on social media.
Equality, diversity and inclusion (ED&I), together with sustainability, are increasingly important criteria for younger job seekers.
Key to recruiting and retaining talent, companies across the industry are proactively establishing more diverse, equitable and inclusive workplaces by regularly revising their policies, providing accessible training and development opportunities, and putting best practice into place.
As for sustainability, the industry has bolstered its commitments to net-zero and widened its sustainability initiatives. The Responsible Care (RC) programme, for example, provides the global sector with an ethical framework for the safe and sustainable use and handling of chemical products.
Conclusion
The chemical supply industry has always faced challenges, in recent years these have included the effects of the pandemic and the war in Ukraine, together with Brexit and the skills shortage, and more recently, the disruption of shipping through the Red Sea.
The CBA has been proactive in its support of its members and the wider industry in all these areas, both nationally and internationally – lobbying for and representing the sector at the highest levels, implementing initiatives like the Future Council, the Young Person’s Award and the People & Skills Hub, and providing essential training and advice.
For more information: Visit: chemical.org.uk/