By Max Clarke
Recruitment prospects are picking up across the private sector, particularly for professional and highly-skilled staff, but there is little wage growth in the economy as pay restraint remains the norm.
That is according to a survey by the CBI and recruitment specialists Harvey Nash out today.
Navigating Choppy Waters, the CBI/Harvey Nash Employment Trends Survey, covers 335 UK employers, which together employ nearly three and half million people. The survey shows that the private sector is seeing job prospects pick up as the economy strengthens, while the public sector is scaling back recruitment as the Government’s austerity measures start to bite.
Reflecting the figures published last week by the Office for National Statistics that revealed the biggest quarterly drop in unemployment in more than a decade, the survey shows that 29% of employers Across the economy plan to increase permanent recruitment in the next six months either across or in parts of their organisations.
With the public sector now taking steps to cut costs, the number of recruitment and pay freezes across the economy has risen: recruitment freezes rose slightly to 9%; while pay freezes are up from 14% in October to 23%. In the private sector, the proportion of pay freezes remained unchanged at 16%, while in the public sector 83% of organisations are operating pay freezes.
“The pay and recruitment freezes that were commonplace in the private sector during the depths of the recession have now migrated to the public sector,” commented John Cridland, CBI Director-General.
“However, we remain confident that private sector growth can more than compensate for job losses in the public sector.
“With the recovery in its early stages and inflationary pressures a worry, employers are having to take tough decisions on pay. Only a quarter of employers can afford to make an award in line with inflation. Most are trying to strike a fair balance by offering either modest awards or targeting pay rises on essential staff. As a result, we are seeing very little in the way of wage inflation in the UK economy.”
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