UK Job Market Deteriorating at Breathtaking Speed

The latest Labour Market Outlook survey from the CIPD and consultancy firm KPMG shows UK companies are shedding jobs at an increasing rate.

The survey of nearly 900 firms suggests that over a third (36%) of employers plan to cut jobs in the first three months of 2009. This is twice as many as planned to make cuts during the last 3 months of 2008.

Even so, 27% do plan to take on additional staff but this is the first time since the survey began 5 years ago that there has been a higher proportion of employers planning to cut staff rather than hire them.

The research also found that employers will be cutting back on pay increases. Average pay rises awarded by those firms who plan to increase wages will be 2.6%, compared with the 3.5% reported last autumn. And as many as 1 in 8 employers do not intend to conduct pay reviews at all throughout 2009.

Summing up the survey’s findings, Andrew Smith of KPMG commented:

“The speed of the deterioration in the labour market is breathtaking.” 

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