UK jobs market improves

Nia Williams

November 9, 2009

But this relative improvement is taking place against a backdrop of a much reduced pressure of demand for labour, with employers’ hiring intentions well below pre-recession levels and plans for staff pay rises and changes to hours of work showing no sign that the labour market is anywhere close to returning to proper health.

This is the main conclusion from findings of the latest (autumn 2009) quarterly CIPD/KPMG Labour Market Outlook (LMO) survey of more than 700 employers, covering all sectors of the economy.

The LMO survey records a negative balance of -3% between the percentage of employers expecting to employ more staff in the three months to December 2009 and the percentage expecting to employ fewer. This represents an improvement on negative balances of -19% and -10% recorded in the spring and summer LMO surveys respectively, with the improvement due mainly to a fall in the proportion of employers planning to make staff redundant compared with earlier in the year.

In the private sector, the jobs outlook is set to further deteriorate markedly in manufacturing and production (a negative balance of -21%) but prospects are much more buoyant in private sector services (+11%). Within the public sector, employers in public administration report a negative balance of employment intentions of -18%.

Gerwyn Davies, public policy adviser at the Chartered Institute of Personnel and Development (CIPD) said: “The UK jobs market remains flat on its back. Things aren’t anywhere near bad as they were earlier in the year when redundancies spread through the economy like a virus. And with things looking up in one or two sectors there is mounting hope that the ongoing gradual decline in job prospects might run its course next year before unemployment reaches 3 million.”

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