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Economic growth needed to prevent further redundancies
The CIPD has published the results of recent research, which reveal that a third of UK companies are continuing to employ staff they currently don't need in order to retain their skills. However, the research also found that these companies can't continue to do this indefinitely, and redundancies will be inevitable if the economy doesn't start to grow.
"This is a make or break moment for employers - unless growth picks up many will find that they cannot hold on to some workers any longer,” said Gerwyn Davies, Labour Market Adviser at the CIPD. “The tenacity with which employers are hanging on to skilled labour is a reflection of the high value they place on it and the damage they fear will be done to their businesses if they are forced to start making more redundancies.”
Almost two thirds of private sector firms feel that they would be forced to cut back on labour if output or service delivery does not pick up in the next year. The report concludes that the recent trajectory of the jobs market, which has seen unemployment fall, may change course if economic growth does not pick up.