CIPD Press releases - CIPD jobs market
updates
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UK
jobs market figures show impact of first phase of
credit crunch, but second phase impact will be harder
still -
12 November 2008
UK
jobs market being crunched 'woeful winter to follow
awful autumn' -
15
October 2008
Worrying
surge in redundancy enquiries strengthens case for
interest rate cut
- 08
October 2008
Slump
in productivity and rising unit wage costs spells
bad news for jobs -
1 October 2008
CIPD
jobs market update - Rise in Bank interest rate would
trigger autumn jobs cull -
09
July 2008
___________________________________________________________
UK
jobs market figures show impact of first phase of
credit crunch, but second phase impact will be harder
still
12
November 2008
Official
labour market figures published earlier today by the
Office for National Statistics (ONS) provide further
evidence of the strength of the lagged effect of the
first phase of the credit crunch. But John Philpott,
Chief Economist at the Chartered Institute of Personnel
and Development (CIPD) says the shockwave from the
second phase of the crunch this autumn is yet to show
up fully and will be stronger still.
Dr
Philpott comments: "The UK just waved goodbye to a
decade long flirtation with full employment. Today's
jobs figures would be considered dire if it were not
for the fact that last month's figures were even worse.
But these figures, which take unemployment to an 11
year high, are bad enough and will sadly be followed
by further bad news in the coming months.
"We
saw the first phase of the credit crunch emerge in
autumn 2007 but it has taken time for the shockwave
to hit the jobs market. Worryingly, just as the impact
was being felt, this autumn saw the second phase detonate
with even greater negative effect on employer and
consumer confidence. The shockwave from this second
phase lies ahead and is likely to be stronger still.
"Today's
figures show the extent of the underlying deterioration
in labour market conditions, with vacancies down and
redundancies up as well as evidence of falling employment
and rising unemployment. Of particular concern is
that unemployment is now being driven up by a combination
of people joining the dole queue and fewer leaving
- demonstrating that firms are sharply cutting back
on recruitment as well as sending more people away
with their P45s.
More
people in work are feeling insecure, and more people
already without work are experiencing the pain of
long-term joblessness. As a result today's separate
good news from the DWP on numbers of people leaving
welfare benefits in the year to May could prove to
be short-lived.
"All
but a handful of regions suffered a fall in employment
in the latest quarter while all have seen a rise in
unemployment. Employment has fallen for all age groups
except those above state pension age for whom the
strong employment growth of recent times has slowed
to a near standstill.
"Claimant
unemployment above 1 million by Christmas is now a
dead cert, as is unemployment at least above 2.25
million on the government's preferred survey based
measure by next spring at the latest. It is still
the CIPD's expectation that, depressing as today's
news is, the jobless total will eventually peak at
somewhat below the near 3 million mark reached in
the 1990s recession. But too many more sets of figures
like today's, plus the likelihood of many more job
cuts to come, and even relative optimism will start
to evaporate.
"In
view of the worsening jobs crisis it is time for policy
makers to 'throw everything but the kitchen sink'
at the problem. We need more coordinated international
policy action and further cuts in interest rates.
We also need UK politicians to stop quibbling over
which party has the best tax and spending plans and
agree on a package of measures combining elements
of cuts in income tax, reductions in taxes on spending,
and financial incentives to encourage employers to
recruit and retain staff."
Source:
CIPD**
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_________________________________
UK
jobs market being crunched 'woeful winter to follow
awful autumn'
15
October 2008
Official
labour market figures published earlier today by the
Office for National Statistics (ONS)
are far worse than expected. John Philpott, Chief
Economist at the Chartered Institute of Personnel
and Development (CIPD),
says the winter will be woeful for jobs and that the
Government's hard earned credibility for restoring
full employment could be blown away in a matter of
months:
Dr
Philpott commented as follows:
"It's
been an awful autumn so far for the economy and the
jobs market is now being crunched. Today's official
figures are dire - the 122,000 quarterly drop in the
number of people in work and the 164,000 quarterly
rise in unemployment underline the severity of the
emerging jobs crisis. With a recession now almost
certainly already underway we face the prospect of
a woeful winter. If today's figures are a guide to
what happens next, claimant unemployment will probably
top 1 million by Christmas with unemployment on the
government's preferred survey based measure heading
for 2.25 million by next Easter at the latest. And
that's likely to be the best we can hope for.
"According
to the latest official figures, vacancies have fallen
and more people are being made redundant. The number
of people in full-time employment has fallen particularly
sharply. Overall, young people aged 35 and under have
borne the brunt of the most recent fall in employment.
But there are signs that older people are starting
to leave the jobs market too as employment prospects
weaken.
"A
real pay squeeze is adding to the jobs crunch. Pay
rises have fallen back just as price inflation has
surged. The combination of mounting job losses, heightened
job insecurity and shrinking real incomes means people
are hardly likely to be rushing out to spend - for
the time being intensifying recessionary pressure
in the economy. This adds weight to the case for further
substantial cuts in interest rates even though the
rate of inflation is well above the Government's
target.
"The
worsening jobs crunch presents the Government with
a stiff test to its hard earned record on jobs. A
decade of building credibility for restoring full
employment could be blown away in a matter of months.
To prevent this, ministers should consider measures
to help people at risk of leaving work for welfare
as well as beefing up measures targeted at those already
jobless. In this context, yesterday's joint DWP and
DIUS announcement of an extra £100 million to help
retrain and develop the skills of people made redundant
or already looking for work is welcome. It is essential
for the future recovery prospects of businesses and
the UK economy that skills development does not come
to a halt."
Source:
CIPD**
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_________________________________
Worrying
surge in redundancy enquiries strengthens case for
interest rate cut
08
October 2008
Figures
released today by the Chartered Institute of Personnel
and Development (CIPD)
indicate that an increasing number of employers are
preparing to make staff redundant.
.Analysis
of calls to the CIPD's legal helpline - which deals
with enquiries from human resources managers - shows
a 28% monthly increase in September in enquiries related
to redundancy. Of 2051 calls to the helpline line
last month 303 were related to redundancy - up from
236 in August and more than double the 142 calls recorded
in September 2007. In the past year the proportion
of calls to the helpline each month related to redundancy
has increased from 9.7% to 14.8%.
The
CIPD's Chief Economist, Dr John Philpott, says that
the helpline statistics are another worrying sign
that the credit crunch is set to take a bigger toll
on jobs:
"A
sombre September awash with bad economic news has
caused more employers to take steps toward cutting
staff levels. A significant decline in the demand
for labour this winter now seems clear, which strengthens
the case for the Bank of England's Monetary Policy
Committee not only to cut interest rates tomorrow
at the end of its monthly meeting but to cut big."
Source:
CIPD**
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_________________________________
1
October 2008
Slump
in productivity and rising unit wage costs spells
bad news for jobs
Figures
on UK productivity and unit wage costs published today
by the Office for National Statistics (ONS)
underline the deterioration in the economy and point
to mounting pressure on employers to cut jobs, says
John Philpott, Chief Economist at the Chartered Institute
of Personnel and Development (CIPD).
Dr
Philpott comments: Productivity measured by output
per worker has slumped. Each UK worker is now producing
less than in the last sharp productivity downturn
in 2005 when employers hoarded staff during what was
a short and mild economic slowdown. At that time,
with little inflationary pressure in the economy,
employers were prepared to absorb rising unit wage
costs and take a short-run hit on profits rather than
cut jobs. But this time around, as the economy moves
into recession and with non-labour costs like fuel
and energy and borrowing charges high, many employers
will be feeling the squeeze.
"Today's
figures indicate that employers have responded by
working staff harder with the result that output per
hour improved slightly in the second quarter, although
still well below what was being achieved in 2006 and
2007. Modest pay rises have also helped contain what
would otherwise have been an even sharper rise in
unit wage costs. However, scope for adjusting to the
emerging economic downturn without cutting jobs is
becoming increasingly limited.
"Even
without the impact of the latest global financial
market turmoil this makes a late autumn and winter
shake-out of jobs all the more likely - and means
that the Bank of England should make an immediate
and substantial cut in interest rates."
Source:
CIPD**
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_________________________________
09
July 2008
CIPD
jobs market update - Rise in Bank interest rate would
trigger autumn jobs cull.
In
its mid-year update on the state of the UK jobs market
the Chartered Institute of Personnel and Development
(CIPD)
finds the outlook for employment and pay to be in
line with its start of year forecast but warns that
a rise in interest rates would put a brake on recruitment
and risks leading to an avalanche of redundancies.
Commenting
ahead of the Bank of England's latest interest rate
decision the CIPD's Chief Economist John Philpott
said:
"Last
December the CIPD
forecast that 2008 would be the UK's worst year for
jobs in a decade and that pay pressure would remain
subdued despite the impact of rising fuel and food
prices. We predicted some growth in employment - though
only a third of that enjoyed in 2006 and 2007 and
not enough to present a rise in unemployment - resulting
from a squeeze on recruitment and a limited increase
in redundancies confined to certain sectors.
"Although
this forecast was initially considered pessimistic
it is in line with labour market outcomes and if anything
now looks relatively optimistic in comparison with
the prevailing mood of economic doom and gloom, widespread
reports of a significant slowdown in recruitment and
a growing number of large scale redundancies
"However,
our initial forecast was based on the assumption that
UK interest rates would fall in the second half of
2008. This now seems unlikely, increasing the risk
that the outlook for employment and unemployment will
be worse than originally expected. Moreover, the CIPD
now also expects limited if any growth in employment
in 2009 with the number of people unemployed and in
receipt of Jobseekers' Allowance rising back above
1 million.
"This
more subdued forecast assumes that Bank interest rate
remains unchanged throughout the remainder of 2008.
A rate cut or cuts would increase our optimism but
a rate hike would be a cause of major concern. Our
indications are that an increasing number of employers
are in 'wait and see' mode and have made contingency
plans for redundancies if the economic situation were
to deteriorate in the coming months.
"Many
employers have their finger on the redundancy trigger.
They are not yet ready to start firing but a rise
in interest rates would probably be enough to cause
a substantial jobs cull come the autumn. And once
this starts the economy could witness a sudden 'avalanche'
of redundancies." Back
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Source:
CIPD**
**The
Chartered Institute of Personnel and Development
(CIPD)
is the United Kingdom's leading professional body
for those involved in the management and development.
They have 130,000 individual members and their objectives
are to lead in the development and promotion of good
practice in the field of the management and development
of people, for application both by professional members
and by their organisational colleagues.
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See
also:
Employers
prioritise management and leadership training to survive
recession - March 2009
CIPD
highlights importance of work-based training - March
09
CIPD
guide helps HR navigate the coaching maze - November
08
Flexible
working - October 2008 Equality and Human Rights Commission
and Chartered Institute of Personnel and Development
