There are some interesting findings on recruitment and pay in the CB/Harvey Nash Employment Trends Survey (PDF format, 521K) published today.
The survey of 335 employers (89% private sector) shows recruitment prospects picking up a little, leading the CBI to state confidently that private sector growth “can more than compensate for job losses in the private sector”.
The detailed findings point to a rather lukewarm picture of the labour market, however, with around half of businesses planning no change in their level of recruitment over the coming 12 months, but small, overall positive balances between higher levels and lower levels of recruitment for permanent staff (11%), temporary staff (7%) and graduates (9%).
On pay, CBI Director-General John Cridland says that: ”we are seeing very little in the way of wage inflation in the economy.”
The findings show that when it comes to the 2011 pay review:
- 31% of firms are planning a general increase below the level of Retail Price Index (RPI) inflation (which was 5.2% in May 2011);
- 17% are planning “targeted increases” for some staff only;
- 20% are planning a general increase in line with RPI; and
- 4% are going for an above-inflation pay award.
Of private sector employers, 16% are predicting a pay freeze, the same as in 2010 (23% when both the public and private sectors are counted).
The findings are a mixture of pay decisions already in force and those not yet taken, as the survey asked employers (in March/April 2011) about pay reviews over 2011 as a whole.
Compared with the latest pay statistics from XpertHR, almost one in four firms planning an increase to match or exceed RPI in 2011 actually sounds quite high compared with current findings on pay trends. The CBI reports that this figure is even higher for the manufacturing sector, at 31%.
Our latest figures showed only one in six private sector pay awards worth more than 3% in the three months to April 2011, considerably below May 2011′s RPI figure of 5.2%. But, like the CBI, we are also finding stronger wage rises in manufacturing, which – as the CBI puts it – “is experiencing a stronger than average recovery and addressing skills shortages in the wake of radical cost containment during the recession.”
Overall, the findings confirm the impression that while we may see some recovery in private sector pay deals in line with what we might expect to see in “relatively normal economic conditions” (as the EEF says in commenting on its latest figures showing a small increase in pay rise levels), we are not going to see a significant inflation-fuelled boost to pay rises over 2011.
Watch out for the latest pay settlement statistics from XpertHR, which are published this Friday, 24 June 2011 and will cover wage deals in the three months to May 2011.