Employment levels will rise by 250, 000 next year according to a review of HR prospects by people management experts, the Chartered Institute of Personnel and Development (CIPD). The CIPD argues that this presents a huge dilemma to UK organisations who are already experiencing severe recruitment difficulties - either they will have use under-used sources of labour, such as immigrants or jobless people, or face wage costs increases next year.
John Philpott, the CIPDís Chief Economist, comments, ìThe self-employed and the public sector are likely to be the biggest winners of the jobs increase next year. While this is undoubtedly good news for business and users of public services, it promises to present an even greater challenge to public sector HR managers who already report recruitment difficulties. To meet the challenge, UK organisations should tap into under-used sources of labour ñ immigrants as well as jobless people, or indeed raise productivity by improving skills in the workplace, to avoid a hike in wage costs in 2004.î
Philpott argues that the more balanced pattern of economic growth will also favour job creation in business services and manufacturing, although it remains doubtful in the case of the latter whether the net effect will be positive.
Philpott continues, ìThe pressures of a tight labour market and business upturn will challenge the increasing proportion of organisations with a written HR strategy to deliver on their strategic goals if they are to remain credible. Poor administrative processes and weak measurement of the added value of good people management, and costs of its neglect, as revealed consistently by our surveys, will be key issues for HR professionals next year.î
The review also includes the latest benchmarking data on a full range of HR practices, which include work-life balance, labour turnover, recruitment, training, stress, career management and sickness absence. The data confirms that the recruitment and retention of skilled staff remains HRís biggest challenge. Nine out of 10 organisations attempting to fill vacancies reported difficulties in 2003 - a sharp increase on the 2002 figure of three quarters - with almost three quarters also reporting retention difficulties. The most common reasons for recruitment difficulty are skill shortages and finding applicants with suitable experience (cited by 54% of organisations).
Other key findings include:
The number of people in work reached a record level of 28.1 million and the unemployment rate remained at 5%.
Average labour turnover for all UK employees fell to a four-year low of 16.1%
Organisations can expect to re-structure in a major way once every three years, with 85% of re-organisations involving voluntary or compulsory redundancy or early retirement.
More than half (56%) of organisations have considered that their career management practices had been effective in meeting strategic objectives. But only 48% have a formal written strategy for career development of their employees.
Private sector organisations are more likely to have a reward strategy (71%) than those in the voluntary sector (51%) and public sector (46%).
The average level of sickness absence in 2003 was 3.9% of working time or 9 working days per employee, a drop from the 2002 figure of 4.4%.
Over a quarter of employees claim to have suffered some sort of physical ailment as a result of working long hours. Nearly half (45%) of employee say that long hours has put a strain on their relationships, with 11% believing it contributed to their divorce.
Three-quarters of organisations say that the impact of the new flexible working legislation has been negligible. Nine out of ten organisations report no significant problems complying with the new requirements.
One in three senior HR practitioners see their current role in the organisation as that of strategic business partner, while one in four consider themselves agents of change.
The most widely reported uses of e-HR systems by organisations are absence monitoring (76%), training and development (64%) and recruitment and selection (55%).
Employment to rise by a quarter of a million in 2004
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