UK jobs on sharp decline

by Editor 9/5/2008 3:25:00 PM
The job market in the UK is going through a critical period, with the total number of new roles on a very sharp decline, according to a new research conducted by consulting firm KPMG and the Recruitment and Employment Confederation (REC).

As a result of the economic crisis, permanent job vacancies have declined at the sharpest rate since November 2001, while temporary positions have also fallen at a record pace.

The rising number of job candidates has also led to the weakest salary growth in more than five years.

“The demand for both permanent and temporary workers is weakening, although it must be remembered that this follows a period of unprecedented high demand for staff,” said REC chief executive Kevin Green. “A positive benefit for the economy is the muted pay growth that the increase in the supply of candidates is creating.”

KPMG director Alan Nolan added: “UK employers are continuing to control payroll costs through redundancies – and by refusing to take advantage of a growing (but increasingly unused) pool of skilled labour. These workers are starting to drift abroad in search of employment and there is a risk that (when the market turns) the UK will be left behind by a skills shortage.”

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Deloitte and KPMG warn: UK economy headed for recession

by Editor 7/30/2008 3:19:00 PM
Leading UK consultancy Deloitte has released its quarterly economic review, in which it examines the effect of the lower pound exchange rate on the British industry. The report concludes that the UK economy may be headed into a recession similar in proportion to the one in the early 1990s.

Economic adviser Roger Bootle explains: “While the sharp fall in the UK exchange rate seen since last summer should eventually lead to a period of better balanced growth, like that enjoyed in the mid-1990s, it won’t prevent the credit crunch and a sharp retrenchment in corporate spending from sending the economy into recession."

Deloitte’s report shows that quarterly growth has fallen to 0.2 percent in the second quarter. The consultancy says that a "technical recession" of domestic GDP declining for two or more consecutive quarters is now more than likely to occur. The report states: “A full-blown slump like the early 1990s is not impossible if the labour market crumbles or interest rates end up rising rather than falling.”

Deloitte’s quarterly review goes on to say that the Bank of England will have to cut interest rates to 3.5 percent in 2009, but this will nevertheless not result in an early economic recovery.

At the same time, KPMG has warned that 53 percent of UK businesses are planning to cut jobs. The consulting firm's quarterly national business confidence survey also shows that 60 percent of them plan to cut overall costs during the recession.

“The clouds that were on the horizon in early spring are now right overhead, with businesses feeling the impact of this so-called ‘perfect storm’ of rising inflation, tightening credit conditions and plummeting consumer confidence," concludes Malcolm Edge, KPMG's head of markets. To find the latest consulting jobs at Deloitte or KPMG, please visit our job board.

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