Round-up of the weekPosted on 13th May 2016
Number of permanent and temp placements rises
The number of permanent and temporary job placements continued to rise last month, new figures have revealed.
However, the data from the Recruitment and Employment Confederation (REC) and Markit revealed that the rate of growth in the permanent jobs market slowed down slightly during April.
Nevertheless, the number of temporary billings went up at a faster rate, seeing the strongest growth it has experienced in more than a year.
Figures from the REC and Markit also showed a decline in the availability of staff to fill job vacancies, as well as further increases in permanent and temporary salaries.
Kevin Green, chief executive of the REC, commented: "The UK labour market is going through an unsettled patch, with uncertainty around a possible Brexit and the impact of the National Living Wage changing employer behaviour with a switch from permanent to temporary hiring.
"Employers are turning to temps and contractors to provide a flexible resource, as a way of hedging any possible change to the UK’s relationship with Europe, and the implications this would have for the economy."
Bank of England downgrades growth forecasts
The Bank of England (BoE) has revised its growth estimates for the UK economy downwards.
Whereas the body had been anticipating a 2.2 per cent increase in economic output in 2016, it now expects to see growth of two per cent.
Similarly, its forecast for 2017 has been changed from 2.4 per cent to 2.3 per cent, while 2018 has been revised from 2.5 per cent to 2.3 per cent.
The BoE has also altered its unemployment rate forecast for this year from 4.8 per cent to 5.1 per cent.
David Kern, chief executive of the British Chambers of Commerce (BCC), responded by saying: "The combination of lower growth and higher unemployment forecast for the next few years confirms the more difficult economic climate that the UK is likely to face in the medium term.
“It is also concerning that the Bank of England’s new forecast shows lower exports and weaker investment in 2016 than was the case in its February predictions."
MPC freezes interest rates
The BoE's Monetary Policy Committee (MPC) has opted to keep interest rates on hold at 0.5 per cent.
David Kern of the BCC said this shows that while inflation has gone up slightly, "any thought of raising interest rates is off the agenda".
Nevertheless, he said the indication that the MPC would be prepared to consider other options if required "is welcome".
"In the current climate British business requires stability with low interest rates, but if the economic slowdown continues or uncertainties mount, the Bank of England must be prepared to act resolutely to maintain the fragile recovery," he commented.
Business leaders divided over Britain's EU membership
Business leaders in the UK are clearly split about whether or not Britain should remain in the European Union (EU), a new survey has found.
According to the Institute of Directors, there was a 63-29 divide in favour of staying in the EU.
Nearly two-thirds of respondents stated that access to the single market is important to their business.
However, three-quarters said they believe the EU should be reformed in order to prevent an economic decline.
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