Job opportunities fall in December, despite year-on-year increase

Job opportunities across the UK fell in December 2010, according to one of the country’s largest recruitment businesses.

The Reed Job Index, compiled using job data from Reed.co.uk, recorded a month-on-month reduction in vacancies posted in December, although the figures confirmed a year-on-year rise of 4% compared with December 2009 when the index began, from 92,423 vacancies to 96,504.

According to Reed, the year-on-year increase is due to increased demand from the private sector, but a reversal in this private sector activity is responsible for the December fall.

Reed’s figures also find that the number of new public sector jobs continued to fall during 2010, to less than half the level of one year ago.

These figures come days after the Chartered Institute of Personnel and Development (CIPD) warned that 2011 will be a worse year for jobs than 2010, with the institute’s central economic forecast predicting that 200,000 people will lose their jobs in the coming year. The CIPD forecasts that these losses will consist of 120,000 in the public sector and 80,000 in the private sector.

In addition, the CIPD suggests that average earnings will increase at a below-inflation rate of 2% in 2011.

Martin Warnes, managing director of Reed.co.uk, offered a slightly more optimistic outlook, saying: “There are grounds for cautious optimism about new job prospects in 2011. Rising private sector demand has been enough to create year-on-year growth in spite of steep falls in new public sector jobs. Job sectors as different as consultancy, marketing, banking and engineering have experienced accelerating demand. Salaries have stabilized and in key areas increased, threatening the reappearance of skills shortages.

“Clearly there are economic challenges ahead. Yet the jobs economy has undoubtedly avoided a much-predicted double-dip in 2010 and the private sector continues to lead a steady recovery in new job demand.”

Read XpertHR’s economic commentary for January 2011, outlining what’s in store for 2011 – featuring comment from the CIPD’s John Philpott and other contributors.

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