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Political uncertainty puts brakes on private sector hiring, as public recruitment soars

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According to recruitment firm Manpower’s Employment Outlook Survey, private sector firms have a hiring intention rating of +7 per cent for the next three months – the same level recorded for the previous three quarters.

The survey gathers responses from 2,100 UK employers on whether they intend to hire additional workers or reduce the size of their workforce.

Mark Cahill, ManpowerGroup’s UK managing director, said: “The private sector is hardly stalling but it remains at the same level. In an improving economic environment, you might expect private sector optimism to be increasing at a faster pace, but it looks as though uncertainty ahead of the general election may be causing some businesses to sit on their hands and take a ‘wait and see’ approach.”

In contrast Cahill hailed a “surprising” jump in public sector optimism with an outlook of +12 per cent, double the national average of +6 per cent, and up ten points on the last quarter.

“You’d think that with austerity cuts across government departments, public sector hiring would be in the doldrums. But what we’re seeing is the reverse,” Cahill said. “Our data suggests that the public sector is front-loading its hiring in the run up to the general election. Equally staff shortages mean some organisations need to take on staff in order to maintain frontline services. Finally as the public sector looks to streamline its services we’re seeing a growing focus on digitisation, leading to an increase in hiring for new skills. We’ve already helped a number of government departments in this area.”

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Scotland was the only UK region where the jobs market was expected to worsen in the coming quarter. Its -1 per cent rating was the first negative outlook in the country for two years. Cahill said: “The fall in oil price has hit Scottish jobs hard with the energy industry providing employment for around 200,000 people across Scotland and the economy of its third largest city, Aberdeen, reliant on the sector. We’ve already seen several big players including the likes of Shell and Wood Group slashing jobs. These initial cuts look to be just the start and we expect to see a further impact across the supply chain as the year progresses.”

The East and West Midlands recorded the strongest hiring intentions among the regions, at +11 per cent and +12 per cent respectively. The North West also did well with +11 per cent. The East of England rose two points to +9 per cent and London held steady at +7 per cent.

Image: Shutterstock

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