Businesses retain staff despite drop in confidence post Brexit
Businesses seem to have shrugged off Brexit uncertainty with 64% of firms retaining staff, according to a survey on Wednesday.
The Recruitment and Employment Confederation (REC) JobsOutlook survey, which interviewed 600 employers and owners, showed just 3% of businesses expect to shed workers in the next three months compared to 24% that are willing to hire more permanent staff in the same time period.
The willingness to hold onto staff comes despite a fall in employer confidence about the economy over the last quarter due to the 23 June EU referendum. In July 21% of employers reported feeling more confident about economic conditions, down from 45% in June and 51% in May.
REC chief Kevin Green commented: “It’s not surprising that confidence took a knock following the referendum result, but there are reasons to be cautiously optimistic.”
Small and medium-sized enterprises (SMEs) had particularly strong hiring intentions with 26% of them willing to take on more permanent staff and 12% wanting to employ more temporary staff.
“SMEs are the lifeblood of our economy and it’s encouraging to see that hiring intentions remain strong within this group, suggesting they have taken the referendum result in their stride” Green said.
Confidence around hiring and investment decisions, however, has fallen month-on-month. In July, 25% of employers expected their organisations to become more confident when hiring, compared to 39% in June and 47% in May.
Looking ahead, Green feels businesses should remain calm during the post-Brexit storm as it will benefit the economy, adding that the government should also do its part. “In general employers have avoided knee-jerk reactions to staffing and this ‘business-as-usual’ approach bodes well for the UK jobs market in the next few months. As business continues to do its bit we now need government to show the same level-headedness to restore economic confidence.” said Green
The public sector in particular shows an opposite trend with 24% making redundancies in the last year. Green said these redundancies will translate into poor levels of service. “At a time when schools and hospitals are already struggling to perform, this situation doesn’t seem sustainable in the long term,” said Green.