Your Pay, Frozen Or Cut Sir?

1st July 09 - Your pay, frozen or cut Sir?

Hard on the heels of yesterday’s diary entry about the fall-off in graduate recruitment, comes the result of a new employment survey by the Confederation of British Industry (CBI) and recruitment group Harvey Nash. It reveals that the same proportion (60%) of businesses that have put recruitment on hold are also planning to either freeze pay or negotiate a cut.

More than 700 companies employing around £3million people took part in the survey and John Cridland, deputy director-general, said that the research revealed that the recession had dramatically altered the workplace landscape. It had been a "particularly bruising recession, but one of its most positive and striking aspects has been the commitment of businesses and their staff to work together to try to trim costs and save jobs." Another key finding was that where jobs could not be saved, the cost of individual redundancy averaged £12,000. One could add that "redundancy" per se in terms of statutory pay is not the only element. It can reach a maximum of 30 weeks pay at a maximum figure of £350 per week (£10,500) but added to this is notice period that can be up to 12 weeks of basic pay.

More than half the businesses surveyed expected recruitment to take more than a year to return to 2007 levels and about half of those though more than two years. Whilst there is clearly a level of self-interest on his part, Albert Ellis, chief executive of Harvey Nash, warned that the UK economy was in danger of losing its competitive edge if British companies failed to take a more "proactive approach to training, accommodating and retaining talent."

Then again Mr Ellis, lose out to whom? There are a few shedding issues elsewhere too.

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