''It is not a good time to be an employee," according to John Philpott, chief economist at the London-based Chartered Institute for Personnel and Development, but it is a good time to be a contractor.
The latest quarterly labour market statistics, published on 15 March 2007 by the Office for National Statistics highlight a continuation of the recent pattern of employment growth, with only self-employment and temporary jobs on the increase, Philpott points out.
Report Summary
- Contractor Jobs Up 5%
- Employee Remuneration 0% changed
- Public Sector Employment Down 2%
- Average salaries and total employment rates both rose during the last 12 months
Regular Pay Amounts Down
''The latest figures do not suggest that the UK labour market is getting tighter, Philpott explains. ''There are more people in work and unemployment is down. But the unemployment rate is unchanged and growth in regular pay (average earnings excluding bonuses) has dipped again. Growth in regular pay is a better measure of underlying wage pressure than growth in average earnings including bonuses, which has picked up but only in private sector services, fuelled no doubt by large City bonuses.''
It is not a good time to be an employee.
John Philpott-CIPD
''Overall, this is not a particularly good time to be an employee. Pay settlements remain modest despite the recent spike in the cost of living and there are fewer jobs in both manufacturing and the public sector. Manufacturing employment is now lower than at any time for a generation while today’s ONS figures showing a 22,000 drop in public sector employment in the final quarter of 2006 are a harbinger of more job cuts to come.'' Philpott continues.
Contractor jobs are up about 5 per cent in the last quarter alone
John Philpott-CIPD
Growth in Contract Working
''The only extra jobs at present are for temporary staff (the latter up by 71,000 or 5% in the latest quarter alone) and the self-employed. This growth in 'contract working...' might be having an effect on the types of jobs on offer in the UK labour market.'' Philpott ascribed a certain number of these contracts to temporary work for workers from Eastern Europe, but cited no statistics to justify the claim. What is clear is that the amount of temporary and contract work is on the rise, while the remuneration for employees remains static.
Total Employment is Up Too
By the end of 2006 there were, according to the ONS quarterly Labour Force Survey 29.03 million people in paid employment in the UK (74.5% of the population of working age). At the same time there were 607,000 unfilled job vacancies and 1.68 million people unemployed.
Average salaries and total employment rates both rose during the last 12 months, official figures have revealed.
According to data from the Office for National Statistics, earnings were up 3.8% in the year to October, while 216,000 more people are in employment compared to the same period in 2005. The news comes after the Bank of England voted to hold interest rates at five per cent last week, but today's disclosure that consumer prices increased by 2.4% since October last year is likely to count against future rate rises in the new year.
Today's rise in average earnings compares to the 3.5% growth experienced in September, while workers in the private sector saw their pay increase by 3.9%, 0.8 percentage points above their public sector counterparts.
But these figures exclude annual bonuses, which would widen the disparity further if taken into account. The ONS also revealed that the number of people claiming jobseeker's allowance fell in October, with 29 million people in employment, three-quarters of Britain's working age population. However, the rate of unemployment currently stands at 5.5%, representing a rise of 0.6% over the last year.