Budget the job

The conclusion of many HR bodies and recruitment consultancies seems to be that the 2009 Budget, while it attempts to make the best of a bad situation, falls far from being a magic potion to fix the economy. The likelihood of recruitment recovering and unemployment falling in the near future remains slim. John Philpott, CIPD Chief Economist, said he felt it was unlikely the challencellor’s measures would prevent a massive rise in unemployment – next spring is still likely to bring three million out of work: “The Chancellor appeared relatively upbeat on his economic growth forecasts, but was probably more sober than expected on the outlook for public borrowing. Consequently the Chancellor’s scope to announce a major “Budget for Jobs” was limited and is unlikely to prevent unemployment rising above three million by next spring.

However, John felt there were reasons to be cheerful for the under 25s, saying:
“The CIPD has consistently highlighted jobless young people as in particular need of targeted action. Although the Chancellor was not in a position to do much the package aimed at the under 25s offers a good ‘bang for its buck’ in creating opportunities for work and training. The experience of past schemes is that they provide short-term relief to the young jobless but do little to enhance their long-term employability. Providing support which is more than simply ‘make work’ will be the acid test of this new initiative.”
 
However, Ruth Spellman, chief executive of the Chartered Management Institute, had this to say regarding the promises for young people: “Whilst welcoming the Chancellor’s determination to protect young people from unemployment and the possibility of creating a lost generation, the Budget misses the opportunity to tackle skills shortages across the workforce. There is a risk that by guaranteeing employment and training for those under 25, the measures will simply displace problems of re-skilling and unemployment to another part of the job market.”

Meanwhile Kevin Green, chief executive of the UK recruitment body, the Recruitment & Employment Confederation (REC), questioned whether the Chancellor has gone far enough to protect workers in the short and medium term, saying: “The Budget may help employment prospects in the long-term, especially for younger workers who are entering the jobs market for the first time. However, with many of these measures not due to take place until 2010 there has to be a focus on immediate action for getting people into work. This must involve reviewing regulations and taxation that impact on job creation and harnessing flexible options such as temporary and contract work as a stepping stone back into the labour market. Measures to enhance trade credit insurance and the maintenance of the Business Payment Support service are a step in the right direction.”

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