Written by Kimberley Startup | February 21, 2014
For many of those recruiting staff as well as those seeking their dream role, there is one survey report in particular that makes essential reading: the quarterly Labour Market Outlook (LMO) report of the CIPD. This is because its data is drawn from the responses of 935 employers on their recruitment, redundancy and pay intentions.
The main headline for those recruiting staff is that while the first quarter of 2014 is likely to see a continued sharp rise in employment, it may not be as pronounced as in the final quarter of last year. The autumn 2013 report recorded a net employment balance – the difference between the proportion of employers anticipating increased staff levels and those expecting to decrease staff levels over the coming three months – of +24, which was a five year high. In the most recent report, that figure had slipped to +16.
Private sector firms have shown particular optimism in recent times about their prospects of recruiting staff, with the net balance having been +38 in the last report. However, this also decreased in the most recent report, to +27. While private sector services firms recorded a +21 balance, the forecast was especially bright among manufacturing firms, which posted +34.
The public sector continues to lag considerably behind the private sector in confidence, although even here, there seems to be a greater chance of such bodies recruiting staff in the short-term, with the -15 balance recorded in the most recent quarter being the strongest for more than four years. Candidates in the north of England may be particularly encouraged by employment confidence levels that barely differ between the north (+7) and south (+10) of the country, following suggestions in previous reports that employers in the north would see declining staff levels.
When asked about their likelihood of recruiting staff if there is 2.5 per cent growth in the UK economy, over a quarter (26 per cent) of respondents said that they would maintain present employment levels, while a similar proportion – 28 per cent – signalled that they would boost recruitment. Only 5 per cent of employers, one in 20, signalled that staff cuts would be made in such circumstances. There is still uncertainty surrounding forecasts other than the very short-term, however, as shown by the fact that four in 10 respondents were unsure how their organisation would be impacted this year by economic growth of 2.5 per cent.
There has also been a slight increase in basic pay expectations since the previous report, with mean basic pay award expectations for the 12 months to December 2014 – excluding bonuses – having edged to 2 per cent from 1.6 per cent. 2 per cent was also the figure given for median basic pay award expectations. Again, the outlook is gloomier for public sector organisations than private sector firms. Nonetheless, the picture emerging from the CIPD report clearly remains a good one for a wide range of candidates and those considering recruiting staff.