Although private sector job creation will offset public sector job cuts in the last quarter of this year, widespread uncertainty as to the future means that employers remain cautious about prospects for the year ahead.
According to the Labour Market Outlook survey undertaken by researchers Ipsos-Mori, some two out of five public sector bodies currently intend to make on average 14% of their workforces redundant.
Despite this, however, there was still an overall net positive balance of +11 in the proportion of employers that aimed to take on new personnel and those that intended to reduce staff numbers – the third quarter in a row to show a positive balance, with figures up from +2 in the summer.
But the report published by the HR body the Chartered Institute of Personnel and Development (CIPD) and management consultancy KPMG revealed that the gulf between expectations in the private and public sector continued to widen. The former showed a net positive balance of +39, which contrasted with a net negative balance of -44 in the latter, and compared with figures of +19 and -35 respectively last quarter.
Employers appeared to be far more cautious about their prospects for 2011, however, putting forward a net positive balance of only +1.
John Philpott, the CIPD’s chief economic adviser, said: “Signs of not only sustained but also increasing buoyancy in private sector job prospects is encouraging, especially since some other forward-looking economic and labour market indicators have been subdued of late. What remains to be seen is how much of this good news is merely a pre-festive season surge in private sector jobs or evidence of a sustained improvement.”
As employers were more far more cautious about the outlook for the year ahead, it was too soon to conclude whether the UK would be able to avoid a rise in unemployment in 2011, he added.
The study indicated that the most positive sectors in employment terms were manufacturing and production (+51), consultancy services (+44) and finance, insurance and real-estate (+44). The most negative, on the other hand, were central government (-95), local government (-65), transport and communications (-39) and education (-34).
The average cost of making employees redundant was £12,000 per individual, with the average cost in the public sector (£19,600) being more than double that of the private sector (£9,350).
The average pay settlement in the 12 months to September 2011, meanwhile, was expected to be 1.5%, although wages were rising more quickly in some parts of the private sector notably financial and consultancy services.
