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CIPD reveals positive outlook for post-COVID hiring

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Employers are optimistic about hiring again after the substantial negative impact the pandemic has had on the job market, according to the CIPD.

In August 2020, the professional body for HR said one in three organisations were expected to cut jobs before the end of the year.

However, just nine months later, all UK sectors are now experiencing a jobs recovery, alongside an improvement in pay prospects, according to the CIPD's Labour Market Outlook report , written in partnership with recruitment company Adecco.  

The quarterly report measured the difference between the proportion of employers expecting to add jobs and those planning to cut them.

Using their net employment score recovery, the CIPD found the amount of employers expected to add jobs to listings had risen sharply to +27 for the second quarter of 2021, compared with +11 in the first quarter of the year. 

The report authors said this was due to both a halving of redundancy intentions, down from 20% to 12%, and a rise in recruitment intentions.

Despite the rise in hiring optimism Gerwyn Davies, senior labour market adviser at the CIPD, said an emerging threat for recruitment lies ahead, partly due to new immigration law.

Davies told HR magazine: “A fall in supply of overseas workers over the past year will mean that HR teams in the UK need to ensure they are looking at all aspects of job quality.

“They must do so to attract more applicants to these newly expected job roles and to offset the inevitability of looming labour skills shortages later on this year.”

Strong employer optimism was found across private, voluntary and public sectors.

Employment intentions were also stronger than at any time since the first Labour Market Outlook was published in February 2013.

While more jobs and improved pay prospects should give occasion for celebration, Davies said a solid jobs recovery must be focused on better jobs, not just more jobs.

He said: “To offset the emerging threat of recruitment difficulties, employers should be reviewing not just their recruitment practices, but also the quality of work they offer.

“For example, employment conditions, the possibility of promotion, training opportunities and the right balance of flexibility and security, should all be reviewed.”

Davies said there’s more to good work than just raising wages.

The report also found redundancy and recruitment intentions have returned to pre-pandemic levels this quarter.

The proportion of organisations planning to recruit in the three months to June 2021 has risen to 64%, which is the highest level since February 2020.

Alex Fleming, region president of Northern Europe at Adecco, said it is encouraging to see that all indicators of recovery are positive in for this quarter of 2021.

“The net employment intentions balance across all sectors is at its highest level since winter 2013, but the disruption of Brexit, paired with the lingering threat of COVID-19, means that now more than ever, organisations must remain committed to levelling up and building back better," he said.

“The need for up and reskilling prospects and improved access to opportunity is only set to become more pertinent, particularly for those who are re-entering or looking to enter into the world of work for the first time.”