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UK employers are the most optimistic they have been in eight years about hiring, according to the quarterly Labour Market Outlook from the CIPD and Adecco.
The net employment intentions balance, which measures the difference between the proportion of employers expecting to add jobs and those planning to cut them, was positive across all sectors, it found.
It rose sharply to +27 for the second quarter of 2021, compared with +11 in the first quarter of the year. It was strongest in the private sector and the voluntary sector, at +28, while the public sector showed a positive intention of +22.
This is the highest level of optimism recorded in the LMO since February 2013, when this measure was first introduced.
The proportion of organisations planning to recruit in the three months to June 2021 jumped to 64% – the highest level since the February 2020 LMO.
Some of the worst affected sectors by the pandemic have reported strong hiring intentions. More than two-thirds (66%) of hospitality firms plan to recruit in the second quarter of 2021, up from 36% in the first quarter of 2021.
Employers are also more optimistic about pay, according to the CIPD and Adecco. Basic pay is expected to increase from 1% to 2% over the next 12 months overall, and in the private sector alone it rose from 1.5% to 2% in the second quarter compared with the first three months of this year.
Pay expectations in the public sector are not as high, however. Pay levels are only expected to rise by 0.9% over the next 12 months, and the CIPD has warned of the “re-emergence of a two-speed pay market between public and private sector workers”.
Gerwyn Davies, senior labour market adviser at the CIPD, said there was reason to feel positive about hiring intentions.