18 May 2012

Employers ‘more confident about hiring’ despite economic gloom

Business groups have given mixed reactions to the latest labour market data from the Office for National Statistics, which suggests that employment rose by 105,000 in the three months to March, with unemployment falling by 45,000 on the previous quarter.

The Confederation of British Industry (CBI) gave a positive response to the news, arguing that the figures show employers are feeling more confident about hiring despite the gloomy economic outlook.

The organisation also welcomed news of a fall in the number of young people out of work, but expressed concerns over the increase in long-term unemployment.

Katja Hall, Chief Policy Director at the CBI, said, ‘While it is encouraging that people are finding work, the increase in long-term unemployment is a concern. These figures emphasise the need to ensure that the work programme delivers and stops people drifting into inactivity’.

Meanwhile, the British Chambers of Commerce (BCC) described the figures as ‘encouraging’ but warned that many challenges remain.

David Kern, BCC Chief Economist, said, ‘Youth unemployment, though down, remains above one million which is a jobless rate for young people of more than 20%. The number of people working part-time because they could not find a full-time job has risen further to a new record high’.

‘The combined effect of the situation in the Eurozone and the Government’s austerity measures will likely cause future job losses over the next year. Measures like real de-regulation, and the creation of a business bank to help improve access to finance, will boost confidence and encourage firms to invest and create jobs and growth’, he added.

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