In response to today’s official jobless figures, the UK’s leading people management experts, the Chartered Institute of Personnel and Development (CIPD), today contrast the fall in unemployment with a sharp reduction in the average working week and a drop in the number of employees in employment.
John Philpott, CIPD Chief Economist comments, The amount of work being undertaken in the UK economy each week dropped suddenly and sharply in the three months to November 2003 - down 7.1 million hours, or 0.8 per cent - despite the welcome news that unemployment is continuing to fall. A reduction in the average weekly hours of both full-time and part-time workers, combined with further falls in the number of employees in employment and slower growth in average earnings, indicates that the UK labour market was less tight at the end of last year than a glance at the headline jobs figures would imply.
Assuming that employers have scope to increase hours of work as the economy recovers - which may to some extent depend on the aspirations of employees for a better work-life balance - serious wage pressure is unlikely to build in the early months of 2004. However, with unemployment low at the outset of recovery, conditions in the labour market look set to become a greater concern for the Monetary Policy Committee later in the year, particularly if growth in labour productivity fails to pick-up.
Sharp fall in hours of work clouds good news on jobs
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