Recruitment levels to rise in 2014, CBI survey finds

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More than half of companies expect to create jobs over the next 12 months, according to a survey published today by the CBI and consulting firm Accenture.

This is the first time that more companies expect to create jobs (51%) than not since the onset of recession in 2008. Graduate and apprentice roles will be a key feature of this wave of job creation, according to the report, with four-fifths of firms expecting to open up roles to young people.

Permanent roles will see more rapid growth than temporary posts, with a balance of +18% (reflecting that 35% of employers surveyed plan higher recruitment levels and 17% lower). Temporary recruitment for the next 12 months shows a balance of +14% (where 29% expect higher, 15% lower).

Private-sector workforces are expected to grow across all regions, with Yorkshire, Humberside and East Midlands likely to see the most promising rise in recruitment levels.

Underpinning this growth will be continued use of more flexible contracts, the survey found. Almost all companies (97%) said they felt flexible employment patterns such as using agency workers or zero hours contracts were either vital or important to the UK economy.

The threat of losing that flexibility is severe: more than two-thirds felt that the burden of employment regulation could hamper employers’ ability to offer flexible contractual arrangements. Almost four-fifths feared that, if the UK were to lose its working time opt-out from EU legislation, this would have a negative impact.

While more eager to recruit on the one hand, employers will continue to take a cautious approach to pay. Thirty-nine per cent said they would offer pay rises below retail prices index (RPI) inflation, and only 7% expect pay to increase above this level. Encouragingly, however, 42% expect pay to rise in parallel with RPI inflation.

There was little enthusiasm in the survey to create a legal obligation to offer a “living wage” above and beyond the national minimum wage. Only 12% of respondents felt that this should be the case.

Commenting on the findings, CBI chief policy director Katja Hall said: “Most businesses believe that flexible employment patterns, including agency and zero hours work, are a critical tool when demand fluctuates and a firm needs to react quickly. These contracts create opportunities for people looking for work that might not otherwise exist, and also attract investment to the UK.”

Olly Benzecry, managing director for Accenture in the UK and Ireland, added: “The skills agenda is critical to not only sustain this growth but to make it inclusive, increasing employability and opportunities for young people who are not in a job, training or education.”

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