CIPD warns of 'recruitment risks'

CIPD warns of 'recruitment risks'

10.7.2008

The Chartered Institute of Personnel and Development (CIPD) has warned that increases in the base rate of interest could have a damaging impact on recruitment efforts around the country.

Online recruitment is a major part of how companies find the right staff for their business but the sector as a whole could be in jeopardy if the Bank of England decides that interest rate hikes are required to keep inflation down.

The CIPD predicted that employment levels would grow slightly over the course of 2008 but has said that this expectation was based on the assumption that the cost of borrowing would fall in the second half of the year.

"A rate cut or cuts would increase our optimism but a rate hike would be a cause of major concern," said chief economist at the CIPD John Philpott.

"Our indications are that an increasing number of employers are in ‘wait and see’ mode and have made contingency plans for redundancies."

Last week, the CIPD insisted that employers in the UK could reduce the number of litigations they are involved in if they made better use of mediation processes in their workplaces.

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