Comment: Grounds for optimism over jobs market

Martin Flanagan. Picture: TSPL
Martin Flanagan. Picture: TSPL
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IT IS a welcome milestone: more than half of UK companies plan to create jobs than not in 2014, for the first time since the start of the recession in 2008.

An employment trends survey from the CBI and management consultancy Accenture says that 51 per cent of firms expect their headcount to be larger in 12 months’ time, with private sector workforces expected to grow across the UK.

Although Scotland does not have the most buoyant jobs prospects – that good fortune goes to Yorkshire, Humberside and the East Midlands, there is also finally some good news for the young unemployed.

Companies say that they feel more confident about taking on extra graduates and apprentices next year, the 16-to-24-year-old demographic having borne the brunt of a lot of the economy’s six lean years.

The report, based on responses from 325 organisations employing more than a million people, will further persuade the Bank of England that the recovery has now gained traction.

The pace of economic growth – and job creation in its slipstream – is likely to remain relatively modest compared with previous recoveries from recession, but we are surely beyond the point of mere green shoots.

Notwithstanding, the latest report does not disarm critics who say that the jobs recovery is largely rooted in low pay and part-time employment.

More than one in three businesses polled plan a wage rise next year below inflation, with only 7 per cent expecting to pay above the retail price index.

That suggests a third or fourth year of frozen pay for many British workers, and is further evidence of an apparently tacit agreement between employers and employees that a job is better than no job, even if at the expense of a decline in immediate living standards.

The vast majority of companies also said the use of agency workers, or zero hours contracts where no work is guaranteed, would also continue to be “vital” in sustaining the recovery.

Taken in the round, then, the CBI/Accenture findings fall short of sunlit uplands for the unemployed or households finances.

However, given the austere employment scraps that the UK has been feeding on for several years now, it is grounds for rising – if measured – optimism.

Normal service resumes as tartan cards pays off

IT WOULD have been a thistle in the balloon if power equipment provider Aggreko had not been chosen to supply the 2014 Commonwealth Games in Glasgow.

Aggreko has both the expertise and the tartan card to play. In addition, it is to supply the football World Cup in Brazil next year, again not entirely unexpected as it has done similar sporting events before many times, including the 2012 Olympic Games.

This year was always likely to be slightly overshadowed on the revenue front in comparison to the London Olympics win, but yesterday’s update shows normal service is resumed.