Crystal Gazing: The Employment Horizon

16 09 2009

The latest employment figures will be announced shortly and it is predicted that unemployment will have reached 2.5 million lives. To pre-empt this the CIPD has given their assessment of what this means for the UK labour market:

It seems that this time round unemployment has not kept pace with the overall fall in production, unlike the downturns of the 80s and 90s. Had it, it’s estimated that we may have seen figures beginning with 3 million… The CIPD’s chief economist John Philpott put this mismatch down to the willingness by the country’s employed population to accept reductions in incomes for everyone over job cuts for some. He termed it the Shared Pain Recession.

There are three forecasts from the CIPD about how the country will emerge from the current recession:

★ Jobs-loss recovery
Weak economic growth leading to continued redundancy and lack of confidence, a possible further dip in the stock market and a climate offear and uncertainty. Should this be the case the CIPD anticipates unemployment to continues to rise to a peak of 3.5million in the next decade, with no return to pre-recession employment levels for the next decade.

★ Jobs-light recovery
Modest economic growth supported by a corresponding balance between redundancy and recruitment for a period of time and a gradual increase in job creation, returning to pre-recession levels after 2015.

★ A Jobs-lined recovery
Seeing sustained growth and demand enabling an increase in demand for a more flexible labour market and creation of jobs and employment with a predicted return to pre-recession job levels by 2012.

Philpott predicts

The current altruism employees are showing by taking the pain of the recession together will not last forever. Should more prosperous times return quickly, workers will return to a more selfish attitude about work.

If we slide into a jobs-loss recovery, employees will eventually become disengaged and their willingness to be flexible about pay and working conditions will melt away. According to Philpott, this is a finite resource.

What Creative Leadership thinks
In order to survive this latest employment trend and be successful, businesses will require creative Talent Management strategies that address communication, resourcing, reward, development and succession planning.

Should your business fail in this regard you will inevitably face the consequences. This could include; increased resignations and sickness, disengaged employees, increased disciplinary and grievance procedures (and possibly subsequent employee tribunals) and most worryingly a decrease in the productivity of your business.

If you’re worried about how this might affect your business, call us for a free consultation today on 01202 853647 or visit http://www.creative-leadership.co.uk.

Sources
CIPD: http://www.cipd.co.uk
BNET: http://www.bnet.co.uk

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