Research from the Confederation of British Industry reveals a greater number of employers have been able to phase out some of the more drastic measures introduced during the recession and are hiring again.
A year ago nearly two-thirds of companies had a recruitment freeze in place. This fell to 37% six months ago and it is currently 5%.
Nonetheless, economic conditions remain challenging. Consequently, most businesses are still adopting a cautious approach to pay.
Some 16% are still operating a pay freeze, but 3% are planning to make an above-inflation pay award.
The survey also provides an insight into how many employers and staff worked together during the depths of the recession to keep job losses to a minimum.
The study notes that the private sector now appears to be emerging from recession, and its experience of engaging employees to change working patterns and cut costs could help the public sector navigate imminent spending cuts.
The survey of UK employers reveals nine out of 10 communicated the impact of the recession on their business to staff. As a result, 87% of businesses said they believed staff understood the need to change working patterns, and more than half said staff showed a flexible attitude to change.
However, this could be a short term blip. Yesterday’s announcement of £6bn cuts is the tip of the iceberg as we await the budget on June the 22nd.
With savage cuts expected in the public sector, the ripples will be felt throughout the economy and we would be amazed if unemployment did not rise in the third quarter.
Author: Chris Slay
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