UK Employer hiring expected to increase into springtime

Finance and Business Services employers lead national hiring plans
Manufacturing job prospects at 2.5 year high
High Street resilient in face of interest rate increases
UK Net Employment Outlook 14%

UK employers say they will continue to keep hiring throughout the spring, according to the latest Manpower Employment Outlook Survey released today. For the third consecutive quarter, the UKís hiring plans continue to be led by employers in the Finance and Business Services sector, albeit at a slower rate than in recent quarters.

The research reveals that 21 per cent of Finance and Business Services employers plan to take on more staff in the quarter ahead and just two per cent plan to make staff reductions, giving a Net Employment Outlook of 19% - eight percentage points weaker than last quarter and one percentage point down on this time last year. At the same time, confidence among employers in the Manufacturing sector has increased notably ñ up by seven percentage points over the quarter and one percentage point over the year to give an Outlook of 14% - the strongest Outlook since Quarter 4 2004.

Manpowerís latest survey of over 1,800 UK employers reveals that a favourable 18 per cent of UK employers plan to increase their headcount over the second quarter (April-June) ñ matching the same increase in hiring plans as reported in each of the last three quarters. Four per cent of employers plan to reduce staff numbers giving a Net Employment Outlook of 14%. 76 per cent of employers plan no change to their staffing numbers. This Outlook is up two percentage points on the last quarter and one percentage point on the year. When seasonal variations are removed from the data, the Outlook is 13%. Employers in all business sectors and all regions of the UK surveyed plan to add to their headcount over the next three months.

Comments Mark Cahill, Managing Director of Manpower UK: ìThe upbeat hiring picture we saw at the start of the year looks set to continue. This is very much a period of stability ñemployer hiring confidence across industry sectors tends to reflect the national average, and employers in all UK regions are positive about their future hiring plans. This is very good news for the labour market.î

Hiring confidence is also reflected amongst employers in the Hotels and Retail sector who anticipate their most optimistic second quarter since 2002 with an Outlook of 13%. Leisure (hotel/restaurants) employers are particularly buoyant ñ 20 per cent plan to take on more staff, an increase of 22 percentage points over the last quarter. None plan to make cut-backs. High Street employers are also upbeat with an Outlook of 12%. Employers reporting figures at or above the national average include those in the Construction, Mining and Utilities sectors.

Continues Mark: ìThe strength of the UK labour market is evidenced by hiring plans not being dented by recent increases in interest rates, nor in the face of rises in inflation. Confidence amongst Manufacturing employers is at a two and a half year high and consumer confidence on the High Street is such that employers are also looking to take on more staff. We will need to see how any future increases in both interest rates and inflation forecasts may impact on consumer spending and filter down to employers, but for now employers remain upbeat.

At a regional level, employers are the most confident in Wales and Yorkshire and Humberside recording an Outlook of 24%: in Wales, they are reporting their most optimistic quarter on record (since 2002), representing an increase of 21 and 11 percentage points over the last quarter and last year respectively; and in Yorkshire and Humberside employers are the most confident they have been at any time since Quarter 3 2001 being 20 and 18 percentage points stronger than last quarter and last year, respectively. Employers in Scotland ( 9%) and the North East ( 20%) are more restrained in their plans than of recent quarters, reflecting a readjustment after periods of strong optimism.

Employers in the South East and West Midlands report figures above the national average whilst those in the East Midlands, the South West, the East, London and the North West are the least confident.

Of the countries surveyed in the Europe, Middle East and Africa (EMEA) region, job prospects are strongest in South Africa, Ireland, Switzerland, Norway and the UK, while French employers report the weakest, but still positive, hiring expectations in the region. In addition to the improvement reported for Germany, Italian employers also reported a notable boost in hiring plans from last year at this time.