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Employment growth continues but applicants face increased competition for jobs, CIPD research reveals

Employment growth is set to continue in 2013 but applicants face increasingly stiff competition for jobs, according to research published today by the CIPD.

The Spring 2013 CIPD/Success Factors Labour Market Outlook report found competition for jobs is particularly fierce for low-skilled workers, with 45 applicants chasing every job.

The report, which uses a net employment balance measuring the difference between the proportion of employers planning to increase staffing levels and those planning to decrease them, predicted a quarter-on-quarter increase from +5 to +9.

The net employment balance for the private sector is +21, up from +16 last quarter. This is the fifth consecutive quarter of projected growth according to the 

Despite this, the CIPD has warned of a "battleground" for jobseekers.

The report also reveals certain groups risk being excluded from the recruitment process. Some 14% of employers said they would not consider employing school-leavers, and 11% would not recruit from the ranks of the long-term unemployed.

Gerwyn Davies, CIPD labour market adviser, said: "Signs of increasing buoyancy in private sector job prospects is encouraging, especially since other forward-looking labour market indicators have been equally positive of late.

"Even though last month's official figures showed a slight dip in the level of employment, these findings suggest that further employment growth is possible.

"However, with a projected increase of half a million people to the UK population over the next 12 months, the number of jobs being created may fail to keep pace with the population growth. In this scenario, we could see employment rising accompanied by increases to unemployment."

He added: "Against this backdrop, it is perhaps unsurprising that the labour market at present is a battleground for job seekers, particularly those with fewer skills or qualifications.

"It is very tempting for employers to feel overwhelmed by such a high volume of applicants and to set a high bar for their needs today."

James Reid, UK and Ireland managing director, SuccessFactors, said: "Long-term unemployment, particularly youth unemployment, can create a 'lost generation' of people whose professional and personal development has been severely hampered by being out of work.

"The overall impact of this skills gap is a society incapable of meeting the productivity demands of a globalised economy. The whole world will suffer if we do not find a solution for this significant challenge."

He added: "We must not only identify industries that will hire our unemployed, but we must also give them the skills and confidence to succeed."