County council leaders have called for more powers to tackle the labour squeeze in the countryside as a new analysis reveals that hundreds of thousands of people have left the rural workforce.

The analysis, published by the County Councils Network (CCN), found that over 320,000 more people have become economically inactive in England’s 36 county areas since the outbreak of the pandemic.

Just over 100,000 of these are early retirees, which is over two-thirds of England’s entire increase in those retiring early. Around 70,000 are also not counted as part of the county workforce because of long-term sickness.

In total there are now over three million economically inactive people in county areas.

The CCN is calling for extra powers over employment and skills to be devolved to their areas to help encourage these ‘missing’ workers back into employment.

CCN chairman Cllr Tim Oliver said: ‘The number of working age people not seeking employment has been an issue for a number of years, with this trend accelerated by the pandemic. But today’s data shows that county and rural areas have seen a dramatic rise and account for the vast majority of new “missing” workers since March 2020.

‘A significant proportion of this rise is attributable to an increase in students who are the workers and innovators of tomorrow. But there has also been sharp rise in the lifestyle choice of early retirement, as well as an increase in long-term sickness, taking 170,000 people out of the employment market in county areas. At a time when we desperately need our local economies to be dynamic and thriving, having a labour shortage impacts on growth and prolongs recession.

‘Therefore, we need more ways to encourage early retirees back into the labour market and to support people who are on long-term sick to come back into employment.’

Cllr Oliver emphasised that this should be locally led.

‘What could work in Durham could be different in Devon. The deals negotiated with seven county areas in 2022 could be transformative – and we urge the Government to build on this momentum and agree further deals with as many local leaders as possible in 2023.’