GitLab LXC: can't upgrade to 13.8 from 13.4.7

Currently I am running GitLab CE in an LXC (13.4.7) and I cannot upgrade to 13.8

There was an error running gitlab-ctl reconfigure:

execute[reload all sysctl conf] (package::sysctl line 18) had an error: Mixlib::ShellOut::ShellCommandFailed: Expected process to exit with [0], but received '255'
---- Begin output of sysctl -e --system ----
STDOUT: * Applying /etc/sysctl.d/10-hardening.conf ...
net.ipv4.conf.default.rp_filter = 1
net.ipv4.conf.all.rp_filter = 1
net.ipv4.tcp_syncookies = 1
net.ipv4.conf.all.forwarding = 0
net.ipv6.conf.all.forwarding = 0
net.ipv4.conf.all.accept_redirects = 0
net.ipv4.conf.default.accept_redirects = 0
net.ipv6.conf.all.accept_redirects = 0
net.ipv6.conf.default.accept_redirects = 0
net.ipv4.conf.all.send_redirects = 0
net.ipv4.conf.default.send_redirects = 0
net.ipv4.conf.all.accept_source_route = 0
net.ipv6.conf.all.accept_source_route = 0
net.ipv4.conf.all.log_martians = 1
net.ipv4.conf.default.log_martians = 1
net.ipv4.tcp_timestamps = 0
* Applying /etc/sysctl.d/90-omnibus-gitlab-kernel.sem.conf ...
* Applying /etc/sysctl.d/90-omnibus-gitlab-kernel.shmall.conf ...
* Applying /etc/sysctl.d/90-omnibus-gitlab-kernel.shmmax.conf ...
* Applying /etc/sysctl.d/90-omnibus-gitlab-net.core.somaxconn.conf ...
net.core.somaxconn = 1024
* Applying /etc/sysctl.d/99-sysctl.conf ...
net.ipv4.tcp_timestamps = 0
* Applying /etc/sysctl.d/protect-links.conf ...
* Applying /etc/sysctl.conf ...
net.ipv4.tcp_timestamps = 0
STDERR: sysctl: setting key "fs.suid_dumpable": Read-only file system
sysctl: setting key "kernel.core_uses_pid": Read-only file system
sysctl: setting key "kernel.dmesg_restrict": Read-only file system
sysctl: setting key "kernel.kptr_restrict": Read-only file system
sysctl: setting key "kernel.sysrq": Read-only file system
sysctl: setting key "kernel.sem": Read-only file system
sysctl: setting key "kernel.shmall": Read-only file system
sysctl: setting key "kernel.shmmax": Read-only file system
sysctl: setting key "kernel.printk": Read-only file system
sysctl: setting key "fs.protected_hardlinks": Read-only file system
sysctl: setting key "fs.protected_symlinks": Read-only file system
sysctl: setting key "kernel.printk": Read-only file system
---- End output of sysctl -e --system ----
Ran sysctl -e --system returned 255


Warnings:
Environment variable LC_ALL specifies a non-UTF-8 locale. GitLab requires UTF-8 encoding to function properly. Please check your locale settings.

Running handlers complete
Chef Infra Client failed. 64 resources updated in 02 minutes 47 seconds

Warnings:
Environment variable LC_ALL specifies a non-UTF-8 locale. GitLab requires UTF-8 encoding to function properly. Please check your locale settings.

Running reconfigure: NOT OK
== Fatal error ==
Something went wrong during final reconfiguration, please check the output
== Reverting ==
ok: down: postgresql: 0s, normally up
Symlink correct version of binaries: OK
ok: run: postgresql: (pid 38071) 1s
== Reverted ==
== Reverted to 11.11. Please check output for what went wrong ==
Toggling deploy page:rm -f /opt/gitlab/embedded/service/gitlab-rails/public/index.html
Toggling deploy page: OK
Toggling services:ok: run: alertmanager: (pid 38088) 0s
ok: run: gitaly: (pid 38095) 0s
ok: run: gitlab-exporter: (pid 38004) 8s
ok: run: grafana: (pid 38117) 1s
ok: run: logrotate: (pid 38132) 0s
ok: run: node-exporter: (pid 38143) 0s
ok: run: postgres-exporter: (pid 38007) 9s
ok: run: prometheus: (pid 38168) 0s
ok: run: redis-exporter: (pid 38171) 0s
ok: run: sidekiq: (pid 38174) 0s
Toggling services: OK
Checking if a newer PostgreSQL version is available and attempting automatic upgrade to it: NOT OK
Error ensuring PostgreSQL is updated. Please check the logs
dpkg: error processing package gitlab-ce (--configure):
 installed gitlab-ce package post-installation script subprocess returned error exit status 1
Errors were encountered while processing:
 gitlab-ce
[master 6efd4f2] committing changes in /etc made by "apt-get install -y gitlab-ce=13.8.8-ce.0"
 4 files changed, 6 insertions(+)
 create mode 100644 gitlab/config_backup/gitlab_config_1674331035_2023_01_21.tar
 create mode 120000 sysctl.d/90-omnibus-gitlab-net.core.somaxconn.conf
Enumerating objects: 1327, done.
Counting objects: 100% (1327/1327), done.
Delta compression using up to 32 threads
Compressing objects: 100% (810/810), done.
Writing objects: 100% (1327/1327), done.
Total 1327 (delta 155), reused 1312 (delta 148)
E: Sub-process /usr/bin/dpkg returned an error code (1)

Not sure if the solution is to make a backup and restore to a full fledged VM instead of an LXC container…