Pace of employment growth continues to quicken, but greater investment in skills needed to drive productivity and pay growth.
19th May 2014, Wokingham (UK)
Commenting on the Labour Market Statistics for January to March 2014 released today by the Office for National Statistics (ONS), Gerwyn Davies, the CIPD's Labour Market Adviser, said:"The bumperquarterly increase of 283,000 in work shows that the UK jobs market continues to go from strength to strength. However, the recovery is still yet to be felt in people's pay packets. Consistent with CIPD predictions, the average basic pay increase has fallen slightly to 1.3%, which remains well below the pre-recession average of 2.5%".
Davies continues, "However, this relatively benign situation for employers in terms of wage growth may change if the labour market recovery continues to accelerate. Skills shortages, currently concentrated in particular sectors and occupations in the domestic labour market, could soon begin to spread to other parts of the labour market putting upward pressure on pay. Employers need to be developing existing workers, as well as hiring new ones, if they're to mitigate this risk and ensure they have the skills to grow."
"Amid predictions that more employers look set to increase business investment this year, now is the time for employers to prioritise training as part of this investment. As well as ensuring that future business requirements are sustainably resourced, this also holds the key to boosting UK productivity levels - a pre-requisite for sustainable increases in the pay prospects of employees sustainably, many of whom are still yet to feel the benefits of the recovery. A failure to act will cause come sectors of the labour market to overheat, while also placing a brake on UK productivity and international competitiveness."
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