UK jobs market set for upbeat 2015 but skills shortage remains

Kingdom Of Great Britain

As the economic recovery continues, 50% of British businesses are planning to take on extra workers in 2015, the CBI said, but skills shortage could stop jobs being filled.

All regions of the UK stand to benefit according to the business lobby group, while Scotland has the biggest plans for the job creation.

Employers also said they would give workers pay rises next year, though at a “cautious rate” as productivity remains weak and competition tough.

Among firms polled for the CBI/Accenture employment trends survey 2014, 43% said they were planning pay rises in line with the retail prices index (RPI), at 2%. About 12% said they would hand workers pay rises above the RPI measure.

UK workers are finally benefitting from a rise in real wages – where pay growth outstrips inflation – after six years of decline. The report found that more permanent than temporary jobs would be created.

Katja Hall, the CBI’s deputy director-general, said businesses were concerned that they would not be able to fill some jobs because of a lack of suitably skilled candidates. This, as well as worries over regulation directed at the flexible labour market, were considered the biggest workforce threats to UK competitiveness.

“It’s a concern that the UK’s growing skills gap is now seen as the number one workforce threat to the long-term health of its economy,” she said.

The CBI has argued that controversial zero-hours contracts – where staff are hired without being guaranteed a minimum number of hours – are an important part of the jobs market.

Zero-hours contracts, of which there are about 1.4m in the UK, have been criticised by unions, which claim workers employed on such terms are paid less on average and have fewer employment rights than permanent employees.

The issue is likely to be debated by politicians in the run-up to the general election in May 2015.

Hall said: “Unstitching the fabric of the UK’s flexible labour market would risk piling new costs onto businesses and ultimately put jobs at risk, so politicians must take care.

“The UK’s flexibility makes it attractive as a place to create jobs and it has been crucial to the recovery, allowing firms to hire quickly or tailor their staff levels to meet customer needs.”

She added that the living wage, based on the amount people need to earn to cover the basic cost of living and which is higher than the minimum wage, should remain voluntary. “Many firms simply cannot afford it,” she said.

Powered by Guardian.co.ukThis article was written by Angela Monaghan, for The Guardian on Monday 22nd December 2014 05.59 Europe/London

guardian.co.uk © Guardian News and Media Limited 2010

 

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