2013 promises a high number of redundancies but also healthy salary increases for UK firms, reports an Aon Hewitt survey.
The survey revealed a mixed picture of the jobs market in the UK. More than a third (35%) of UK organisations said they were considering redundancies this year – higher than any other European country bar Greece. Yet those same organisations anticipated salary budgets to hold strong at 3%, suggesting that it wasn’t simply a knee-jerk reaction to tough times.
"This high potential figure for redundancies may stem in part from UK organisations feeling that they continually have to adapt and reorganise to remain competitive in what is still a volatile economic environment,” said Andrew Macleod, leader of Aon Hewitt’s pay research practice in the UK.
Almost a third of respondents expected recruitment activity to increase this year. Even more encouragingly, only 6% of UK organisations planned a hiring freeze, lower than most markets across Western Europe and the lowest figure since the beginning of the economic downturn. These pay freezes were most likely to be in construction and engineering, while food and beverage, insurance, energy and pharmaceutical industries did not expect any pay freezes.
“Organisations seem to be increasingly aware that they have to ensure that their best people are paid well and get decent salary increases – even if they have to freeze pay generally for their staff,” said Macleod.