The CIPD quarterly HR report

Higher wages are not seen as an answer to increased competition for talent

Rather than offer higher wages, employers are opting to invest in the learning and development of their staff and other measures to hang on to talent, and turning to migrant labour to fill vacancies, according to the Chartered Institute of Personnel and Development (CIPD).

The 17 per cent positive balance of employers expecting to employ more staff by autumn 2005 over those expecting to employ fewer is the lowest recorded in the CIPD’s Human Resources Quarterly Trends and Indicators surveys in 2004.

The latest survey found:

  • More than half (52 per cent) of employers expect to have increased the total number of employees on their pay roll by the end of the autumn

  • Difficulties with recruitment are expected by 48 per cent of employers over the autumn

  • Among the quarter of all employers conducting a pay review in the autumn, four-fifths (41 per cent) expect no increase in average pay levels, and 36 per cent expect pay levels to increase by between 2 per cent and 4 per cent.

Migrant workers

Recruitment difficulties and skills shortages are sending employers overseas in their hunt for talent:

  • Over half of all employers say professional vacancies (38 per cent) and skilled trade vacancies (14 per cent) have proved most difficult to fill over the summer.

  • Almost one in three employers (28 per cent) is planning to recruit workers from overseas this autumn.

  • Among larger companies (more than 500 employees), this figure rises to 40 per cent.

  • Recruitment from abroad varies from region to region – in London, 45 per cent of employers intend to recruit from abroad, compared to only 13 per cent in the North East.

  • The public sector is most likely to turn to migrant workers – 34 per cent of public sector employers are planning to do so, compared to 27 per cent in the private sector and 24 per cent in the not-for-profit sector.

  • Three-quarters (75 per cent) of employers are offering migrant workers permanent contracts, while less than 10 per cent are offering only short-term or seasonal contracts.

  • Professional skills (45 per cent) and technical skills (22 per cent) are the main attributes that employers are seeking from abroad.

Regional variations

Difficulties filling vacancies are greatest, surprisingly, in regions where joblessness is relatively high.  The North East (43 per cent) and Yorkshire and Humberside (44 per cent) are most likely to cite a lack of applicants as a problem when trying to fill vacancies.

Employers in the South East (87 per cent) and London (88 per cent) are most likely to be recruiting during the autumn.  Employers in the North East (73 per cent) are least likely to be recruiting this quarter.

Public sector vs private sector employment

Despite talk of public sector job cuts, 87 per cent of public sector employers intend to recruit during the autumn, compared to 80 per cent across the private sector and less than 70 per cent in the primary production sector.

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