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| Overview |
The employment situation will deteriorate further in the fourth quarter of 2011, with the LMO net employment index having fallen to -3 from -1 in the past three months. This is the second successive quarterly fall and the lowest net balance since winter 2010. Medium-term prospects are no better, with the 12-month index also recording -2. The private sector looks set to grow in the next three months (+20), but at a slower pace than in recent quarters. Confidence in the public sector remains low (-50) for the next three months and is even lower for the year ahead (-57). Meanwhile, the voluntary sector has seen no movement in net employment intentions for the fourth quarter of 2011, remaining at +7.
Employers also seem to be hedging their bets on all employment-related decisions in response to the current economic uncertainty: hiring intentions and redundancy intentions have fallen across all sectors compared with recent previous reports. The proportion of firms intending to hire migrant workers, which has risen steadily in recent consecutive quarters, has also fallen to 19% from 25% during the past three months.
As regards pay intentions, three-quarters of employers are planning a pay review by August 2012 and a quarter intend postponing their pay review.Among LMO employers planning to have a pay review before August 2012, there is an average expected increase of 1.48% in their basic pay settlement (excluding bonuses, incremental increases, overtime and impact of re-grading exercises). This represents a minor decrease from the 1.56% reported in spring 2011 but is similar to what was reported in the summer quarter (1.45%).
See also ‘CIPD paints gloomy picture for jobs and pay’ – the summer 2011 Labour Market Outlook report.
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