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Recession has positive effect on employment landscape

The recession has ‘dramatically altered’ the way UK workplaces are operating, new research revealed today.

Employers and staff are working together to protect businesses and jobs by increasing flexible working and freezing pay and recruitment, according to the CBI and recruitment experts Harvey Nash.

Their research showed that almost two thirds of employers have made or are considering making “significant” changes to the way they organise their workforce and working patterns.

More flexible working hours, extended shut-downs, extra holiday and cuts in paid overtime have all become more commonplace as the recession has deepened and firms have become determined to cut costs.

Sarah Green, Regional Director, CBI North East said: “This has been a particularly bruising recession, but one of its most positive and striking aspects has been the commitment of many businesses and their staff to work together to try to trim costs and save jobs.

“The UK’s flexible labour market has proved a huge asset during these testing times, and flexible working changes have enabled employers and staff to create leeway on working hours.

“While pay and recruitment freezes should disappear as the economy recovers, the spirit of flexibility and the willingness of many staff to engage positively with employers on these issues will hopefully be a more permanent benefit of the UK economy.”

Positive changes

Many employers questioned in the survey are standing by their staff training, and two thirds want to target training more efficiently. In cases where jobs could not be saved, individual redundancy payments have averaged around £12,000.

45% have increased flexible working among staff to reduce hours and meet employee requests for a work-life balance. A further 24% are considering or intending to make increases. Making a flexible response to falling economic demand, a third (33%) of employers have cut their use of agency staff, while 43% have reduced paid overtime.

Albert Ellis, CEO of Harvey Nash, said: “The recession has led to fundamental changes in the way employers recruit, motivate and develop employees, and UK plc must act fast to keep highly skilled talent in the UK labour market. Otherwise, we run the risk of conceding out competitive edge to other countries.

“Without a more proactive approach to training, accommodating and retaining talent, businesses risk missing out on the next generation of skills needed to compete. We have a wealth of knowledge, experience and skills in the UK that must be nurtured and developed, even in troubled times, for the future of the British economy.”

To keep employees incentivised, 62% of companies have kept their existing bonus structure but, in the wake of the credit crunch, 46% of firms in the banking, finance and insurance sector have reformed their schemes.

Sarah Green, Regional Director, CBI North East said: “Employers and their staff are doing whatever they can to keep businesses and jobs going, but the government can help by improving the availability of credit for investment. Firms are also concerned by the prospect of extra employment regulation at this difficult time. The government should wait for the upturn before increasing the load on businesses.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .