Private-sector companies will continue to be cautious about recruitment for the next six months, according to the latest Employment Trends Survey from the CBI and recruitment company Harvey Nash, released today.
Just over one-third of businesses expect their workforce to have increased in 12 months' time, while 13% expect theirs to decrease, the survey of 300 companies found.
The outlook is best for science and technology companies, 48% of which expect their workforces to be larger in 12 months' time. Small and medium-sized firms are also relatively optimistic, with a balance of +36% in the smallest respondents saying that they expected to add to their number in the next year, and +27% of medium-size businesses doing the same.
Less than one-fifth of organisations plan to take on more temporary workers in the coming year, a year on from the Agency Workers Directive, which stipulated that organisations had to grant temporary workers the same rights as permanent staff after they had been in the role for 12 weeks.
The CBI said the flexible labour market was behind companies' caution about taking people on. "The performance of our flexible labour market in generating jobs in a sluggish economy is a mini-miracle. Businesses look set to continue with the positive but cautious approach to hiring that we've seen over the past couple of years, and this is echoed in expected pay restraint designed to protect employment," said Katja Hall, the CBI's chief policy director.
One of the key findings of the Employment Trends Survey was a need to improve the employability prospects of young people, in order to ensure a pipeline of talent for a growing number of vacancies in skilled areas. Hall added: "While the jobs figures tell a promising story, too many young people from disadvantaged backgrounds are not getting jobs because job creation at a skilled level requires skills and attitudes which we do not help them to develop."
Lack of aspiration (57%) and lack of role models (53%) were cited as the most serious barriers preventing people from disadvantaged backgrounds finding work, followed by poor basic attitudes to work.
The report argues that schools can do more to prepare young people for the challenges of work, identifying greater access to vocational training and apprenticeships and raising educational standards as key government priorities. More than half (51%) of respondents said careers advice needed to be improved.
"To gain a competitive edge, businesses are investing in and nurturing talent," said Albert Ellis, chief executive of Harvey Nash. "Most encouragingly, more than one-fifth of employers are looking to increase their graduate hiring in the next year and 23% are set to boost apprenticeship numbers, thereby investing in the skills of the next generation. This is also good news for those seeking out a first foothold on the career ladder, but the survey shows a lack of skills and experience is holding back some from fulfilling their potential."
There were more encouraging findings in terms of what companies are doing to embrace diversity. Six respondents in 10 already have, or are considering introducing, family-friendly policies, while 62% said that they have embedded gender diversity into their organisation. For board-level appointments, almost one-fifth are operating, or considering, positive action on shortlisting female candidates for senior roles.
Hall added: "Encouragingly, we are seeing action on gender diversity driven by talent, not tokenism. For three-quarters of firms taking action on gender diversity, their aim is to access the broadest talent pools, and in six out of 10 businesses, initiatives are driven by the culture of the company. This kind of business-led approach, tailored to the needs of each firm, will be the best way to boost diversity right to the top of the company - factors which no legislation can change."
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