Public sector employment levels fall as cutbacks bite

Employment levels in the public sector are expected to fall over the next six months, compared to continued rises in the private sector.

This is the first fall in public sector employment levels predicted since the Gershon Review in 2004 which recommended savings of 21 billion over four years, including the loss of 80,000 civil service jobs.

The latest findings from the Recruitment Confidence Index (RCI), produced by Cranfield School of Management, reveal that 89% of public sector organisations expect their employment levels to either fall or remain at the same level over the next six months, compared to only 55% of private sector organisations.

Similarly, 85% of public sector organisations expect their recruitment activity to drop or stay the same compared to 60% of private sector organisations.

The findings suggest that the number of employees in the public sector may actually be about to fall for the first time since the Gershon Review.

Professor Shaun Tyson, Emeritus Professor of Human Resource Management at Cranfield School of Management, said:

ìThe findings reflect the more stringent environment faced by the public sector, where the many years of expansion have come to an end. The focus now is upon leveraging value for money rather than extensive recruitment.î

Emma Parry, Research Fellow at Cranfield School of Management said:

ìThe recruitment marketplace has appeared positive for some time now with the private sector, and particularly service sector organisations, recruiting workers. This quarter we can see a stark contrast between the still buoyant picture in the private sector and the apparent cutbacks in the public sector which may be the first indicator that the implications of the 2004 Review are filtering through. A drop in public sector recruitment activity and employment levels now being predicted is an inevitable consequence of such policies.î

The research showed that recruitment activity overall remains relatively buoyant, with over a third (36%) of organisations expecting activity to increase over the next six months. Similarly, 40% of organisations overall expect employment levels to rise. This confidence is fuelled by positive predictions from the private sector.

The latest RCI findings also show that:

Most respondents (72%) feel optimistic about business confidence and around half expect the demand for their main product of services to rise over the next six months.

80% respondents are expecting to experience recruitment difficulties.

Recruitment difficulties were expected to be significantly higher in the private sector (83% organisations) than in the public sector (69%)

Recruitment difficulties were expected to be highest when recruiting engineering (61% organisations) and IT skills (50%).