Last reviewed 8 March 2021
According to the latest Labour Market Outlook published by the Chartered Institute of Personnel and Development (CIPD) and Adecco, UK employers are reporting their strongest employment intentions in a year and the country could be close to its unemployment peak.
The survey’s net employment intentions figure, which measures the difference between the proportion of employers expecting to add jobs and those planning to cut positions, rose to +11 this quarter — its highest in a year.
This compares to –1 in the previous quarter.
Over half (56%) of the 2000 employers surveyed indicated they are looking to recruit in the first quarter (Q1) of 2021, up from 53% in the previous quarter and 49% six months ago.
This is down from 66% during Q1 last year.
Sectors that are indicating strong hiring intentions include healthcare (80%), finance and insurance (65%), education (65%) and information and communications (67%). However, this optimism does not extend to sectors that continue to be affected by the social distancing measures, such as hospitality (36%).
While overall basic pay award expectations remain at 1% in line with the previous quarter, median basic pay expectations in the private sector have increased to 1.5% from 0% since the previous report.
By contrast, median basic pay expectations in the public sector in the 12 months to January 2022 will be 0%, which compares with 1.4% in the voluntary sector.
Gerwyn Davies, Senior Labour Market Adviser at the CIPD, said that overall these were the first signs of positive employment prospects seen in a year. “Our findings suggest that unemployment may be close to peak,” he went on, “and may even undershoot official forecasts, especially given the reported fall in the supply of overseas workers.”
However, Mr Davies warned, it is far too soon to rule out further significant private sector redundancies later in the year if the economy suffers any additional unexpected shocks.
Comment by Paul Holcroft, Managing Director of Croner
We may begin to see these figures rise in the coming months as the Prime Minister’s roadmap out of England’s lockdown has now been revealed.
With non-essential shops likely to reopen on 12 April 2021 at the earliest and a return to normal, although we are yet to know what this will look like, expected on 21 June 2021, we may see a spike in demand for new staff before the end of the year.