Labour Market Outlook - Summer 2011

A recent report suggests that the employment recovery in the past 12 months may slow sharply in the next quarter.

The quarterly Chartered Institute of Personnel & Development (CIPD)/KPMG Labour Market Outlook highlights employers’ recruitment, redundancy, and pay intentions. The survey is based on 1,056 HR professionals.

The report looks at the net employment balance – which measures the difference between the proportion of employers who expect to increase staff levels and those who expect to decrease staff.

The report’s net employment intentions balance, which looks at the third quarter of 2011, is negative for only the second time since the recession (that is, winter 2009–10). The report’s net employment balance (that is, the overall effect of recruiting new staff and/or making redundancies) has fallen to –1 from +3.  
 

The private sector is continuing to grow (+23), but at a slower pace than in previous quarters. On the downside, employment prospects in the manufacturing sector have fallen to +11 from +32 compared with the previous quarter. In contrast, employment intentions remain strong in the services sector (+ 23).

Employment prospects are likely to remain very weak in the public sector, although there has been a slight improvement. The public sector balance has risen to –51 from –52 compared with the previous three months.

Overall, the report indicates that the recent strength of the jobs market may weaken, and may even lead to a fall in employment levels over the next four quarters.

The poor outlook for employment is likely to dampen pay increases. The expected average pay settlement in the 12 months to June 2012 has fallen to 1.5% from 1.6% over the past three months.

A recent report suggests that the employment recovery in the past 12 months may slow sharply in the next quarter.

The quarterly Chartered Institute of Personnel & Development (CIPD)/KPMG Labour Market Outlook highlights employers’ recruitment, redundancy, and pay intentions. The survey is based on 1,056 HR professionals.

The report looks at the net employment balance – which measures the difference between the proportion of employers who expect to increase staff levels and those who expect to decrease staff.

The report’s net employment intentions balance, which looks at the third quarter of 2011, is negative for only the second time since the recession (that is, winter 2009–10). The report’s net employment balance (that is, the overall effect of recruiting new staff and/or making redundancies) has fallen to –1 from +3.  
 

The private sector is continuing to grow (+23), but at a slower pace than in previous quarters. On the downside, employment prospects in the manufacturing sector have fallen to +11 from +32 compared with the previous quarter. In contrast, employment intentions remain strong in the services sector (+ 23).

Employment prospects are likely to remain very weak in the public sector, although there has been a slight improvement. The public sector balance has risen to –51 from –52 compared with the previous three months.

Overall, the report indicates that the recent strength of the jobs market may weaken, and may even lead to a fall in employment levels over the next four quarters.

The poor outlook for employment is likely to dampen pay increases. The expected average pay settlement in the 12 months to June 2012 has fallen to 1.5% from 1.6% over the past three months.