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 CIPD PRESS RELEASE 14 May 2008
Employer survey finds four year low in demand for
staff but no sign of imminent jobs slide
The latest quarterly CIPD/KPMG Labour Market Outlook (LMO)
survey of UK employers, finds hiring expectations
little changed between the winter and spring quarters,
following the marked softening in employer sentiment
that occurred between the autumn and winter. Pay rises
meanwhile remain modest and there is no sign of higher
living costs inflating pay deals.
The spring LMO survey findings indicate that although
the overall demand for staff has weakened since the
end of last year - and is weaker than in any of the
spring surveys since the LMO series began in spring 2004 -
there is no sign that conditions in the jobs
market have yet deteriorated dramatically in response
to the emerging economic slowdown. Instead employers
seem to be adopting a cautious 'wait and see' approach
to their staffing requirements rather than taking
drastic action to cut jobs.
According to the LMO survey 37% of the 735 employers
questioned by IPOs MORI expected to increase staff
levels in the spring quarter (March-May 2008). This
is slightly higher than the 34% recorded in the winter
quarter (December 2007-January 2008) but well down
on the autumn quarter (September-November 2007) figure
of 46%. The spring 2008 figure is also lower than
that recorded in spring 2007 (39%), spring 2006 (41%),
spring 2005 (49%) and spring 2004 (53%).
Almost 2 in 5 employers surveyed intended to carry out
a staff pay review in the spring quarter. Of these a
quarter expected to be awarding average pay increases
of 2% and almost a third (32%) increases of 3%.
Dr John Philpott, Chief Economist at the Chartered
Institute of Personnel and Development (CIPD) says: "Conditions
in the UK labour market are clearly softer
than six months ago and softer than at this time of
year for several years. But net hiring (recruitment
minus redundancies) remains strongly positive which
suggests that while the labour market is currently
experiencing a period of relative slowdown - which
should in due course show up in official statistics,
possibly in those being released later today by the
Office for National Statistics - the market is far
from approaching a state of meltdown.
"However, with employers in 'wait and see' mode it
remains possible that falling confidence in the
outlook for the economy might still trigger a wave
of job cuts. If so the tipping point in confidence
could result in a sudden avalanche of redundancies
and quickly transform the current relatively benign
jobs scene. A further early cut in interest rates
would be advisable to limit the chances of this
outcome."
Notes to editors:
* John Philpott is available for interview.
* The Chartered Institute of Personnel and Development (CIPD)
has over 130,000 members and is the leading
professional institute for those involved in the
management and development of people.
CIPD press enquiries:
Gregor Ridley / Anna Wallace / Rob Blevin
CIPD Press Office
151 The Broadway, London SW19 1JQ
020 8612 6400
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