Small firms lead the UK out of recession

Manpower Employment Outlook Survey revales most positive employment outlook since 2008:

• Small businesses are driving job creation, hiring intentions of +8% in the coming quarter
• Predicted major job losses in the Civil Service – “Just not happening”
• Overall UK recruitment trend +3%, level not seen since height of financial crisis

LONDON, 14 JUNE 2011: Despite continuing economic gloom, the UK’s Employment Outlook is the most positive it has been in three years, according to Manpower, the global leader in contingent and permanent recruitment workforce solutions.

The Manpower Employment Outlook Survey is based on responses from over 2,100 UK employers about whether they intend to hire additional workers in the coming economic quarter. It is the most comprehensive, forward-looking employment survey of its kind and is used as a key economic statistic by both the Bank of England and the UK government. The positive national Seasonally Adjusted Net Employment Outlook of +3%  indicates employers are intending to create additional jobs in the next quarter; this compares with a Net Employment Outlook of +2% in Q2 2011.

Within the private sector, it is only small and medium enterprises (SMEs) that are predicting job creation with a +8% Outlook. However, worryingly, hiring intentions among the UK’s largest businesses have fallen for the third successive quarter and now remain flat.

“It seems when it comes to job vacancies, small is beautiful.” says Mark Cahill, UK Managing Director of Manpower.  “Candidates sometimes assume that bigger is better when it comes to employers, but these statistics clearly point to the opposite. SMEs were amongst the first to shed jobs during the recession, but we’re now seeing them build their workforce again and becoming an increasingly important source of job creation in the UK. The greatest unmet demand is for highly sought-after candidates in national skills shortage roles, such as engineers and IT specialists. Engineers have, it seems, become the new plumbers!”

Overall, the national Outlook is positive for the 7th successive quarter and more positive than it has been since the height of the recession. Finance, Banking and Business services remains the most bullish sector, with a +10% Outlook. Agriculture, Transport, Utilities and Manufacturing sectors also all report positive hiring intentions.

The Outlook in Manufacturing, which dipped to a negative Outlook during the recession, has bounced back to become one of the most positive sectors, with intentions of +6%, up five points compared to this time last year.

Whilst the public sector continues to report a negative Outlook, with hiring intentions of -2% in the next quarter, this negative public sector figure is not as pessimistic as before, calling into question the size of the cutback in the civil service of central government.

Cahill continues “We’ve been warned for such a long time to expect large scale public sector job cuts in central government, but in our experience that is just not happening. If the government really intends to make the large scale redundancies initially suggested, ministers must realise that the longer they wait to start this process the harder it will eventually become. Current conditions therefore do call into question whether the big redundancies will happen at all. As one of the leading providers of personnel to both government and the private sector, we’re now confident that job creation in the private sector, particularly among SMEs, can now fill the gap created by job losses in the public sector.”

Regionally, roughly half are reporting positive hiring intentions. West Midlands leads the way with its +13% Outlook. East of England and the North East both report +8%, the South West +7%, and London, the South East and Northern Ireland all expect +6%. Scotland continues its prolonged negative Outlook, with intentions of -7% for the next quarter; the region has not reported a positive Outlook since Q2 2008. Wales slides back into negative territory with a -3% Outlook, following two quarters of positive intentions. At -2%, the North West reports its most negative Outlook since the beginning of 2010.

Click here to access the Survey results in full.

For further information about the Q3 2011 Manpower Employment Outlook Survey, and to view an interactive map of the results for each geographical region and industry sector, please visit: manpower.co.uk/meos