Worsening job prospects at the start of 2012, as unemployment looks set to reach 2.85 million
A survey of more than 1,000 employers, conducted by YouGov, for the Chartered Institute of Personnel and Deployment’s (CIPD) quarterly ‘Labour Market Outlook’, shows that the first quarter of 2012 will be the most challenging since the start of the recession; much of this being down to an increase in redundancies. You may also find yourself at a further disadvantage if you’re searching for a job in the North of England, as the north-south jobs market divide continues to worsen.
The report, which uses a net employment balance to look at the difference between those companies looking to employ, and those who intend to decrease staffing levels, shows that worsening job prospects can be almost entirely attributed to a drop in confidence in the private sector, in recent months. For instance, whilst net employment within the private sector does remain positive, at +10, it has fallen from its previous +20, and nowhere near makes up for the dramatic decline in public sector employment of -49.
Although the majority of unemployment is down to redundancies, a fall in the employment intentions of firms in the private sector accounts for the rest. For instance, employment growth in manufacturing is set to stall, and a dip in the net employment intentions of firms in the services sector is also expected.
The survey also indicates an increased division between north-south job prospects. Whilst the chance for employment in the south of England has increased moderately, from -4 to -1, the prospects for those living in the North have worsened considerably, falling to -20 from -17. Furthermore, the most recent official Labour Force Survey showed that the north east of England, and the north west of England, saw the largest unemployment increases in the 12 months to November 2011.
Finally, when looking at the past two years, nearly half of employers interviewed were of the opinion that they had been prevented from creating new roles; with the main barriers being access to finance and skill shortages.
Gerwyn Davies, Public Policy Adviser at the CIPD, said: “Whereas employers were in ‘wait and see’ mode three months ago, more private sector firms, particularly among private sector services firms, have decided to push the redundancy button in response to worsening economic news. This will exert yet more pressure on a jobs market that is buckling under the strains of contractions in economic growth and public sector employment.
“The fear is that these existing pressures, which include a widening chasm between the employment prospects of those in the north and the south, will become greater still if business conditions do not improve in the next few months.
“With many employers telling us that access to finance has been a big factor in preventing them from creating new jobs over the last two years, and with net private sector hiring intentions now on the slide, the labour market case for government action to increase the availability of credit to businesses is stronger than ever.”