Headlines: January 6th, 2004

Organisations in the United Kingdom will face increased problems in recruiting staff, according to the Chartered Institute of Personnel and Development. It predicts that employment levels will rise by 250, 000 in the next year and says this presents a huge dilemma to organisations already experiencing severe recruitment difficulties, especially in the public sector.The CIPD says companies and other bodies will either have to turn to under-used sources of labour, such as immigrants or jobless people, or face increased wage costs.

The institute’s review also includes the latest benchmarking data on a range of Human Resources practices, including work-life balance, labour turnover, recruitment, training, stress, career management and sickness absence. The findings confirm that the recruitment and retention of skilled staff remains the biggest challenge for HR professionals. Nine out of 10 organisations attempting to fill vacancies reported difficulties in 2003 and almost three quarters also reported staff retention difficulties. The most common reasons given for difficulties in recruitment are skill shortages and finding applicants with suitable experience.

Other key findings show that the number of people in work reached a record level of 28.1 million and average labour turnover for all UK employees fell to a four-year low of 16.1per cent. The study also shows that 71 per cent of private sector organisations have a reward strategy in place compared with 51 per cent in the voluntary sector and 46 per cent in the public sector. The most widely reported uses of e-HR systems are absence monitoring, training and development and recruitment and selection.

John Philpott, the CIPD’s Chief Economist, predicts that self-employed people and public sector workers are likely to be the biggest winners of the jobs increase. While this is good news for business and users of public services, he says it promises to present an even greater challenge to public sector HR managers who already report recruitment difficulties. To meet the challenge, UK organisations should tap into under-used sources of labour such as immigrants and jobless people, or raise productivity by improving skills in the workplace to avoid a hike in wage costs in 2004.