CBI Labour Market Update Takes the Temperature of UK Economic Fightback
The run-up to the UK General Election created an understandable air of uncertainty. So has the post-election outcome helped settle the wider business market?
In many cases it's still too early to tell, and analysts need more time in order to draw reliable conclusions on the state of the UK economy. However, the CBI's Labour Market Update for May 2015, released earlier this week, paints a positive picture of employment as a major indicator of the UK's strengthening economy.
On a top level basis, the CBI state that more people are in work and earning more - but add an air of caution by claiming that "the job on unemployment isn't done yet".
Specifically, May's findings include:
The full report is available to view here
- Flexibility wins: Our sector knows a thing or two about the enormous benefits of flexibility, and the labour market is also reaping those rewards. The CBI found that greater flexibility at work is driving an increase in employment "by a healthy amount".The report also found that, from January - March 2015, the number of people in work rose by 202,000. It's a slight drop on figures released in April, but is still described as "strong" compared to rises seen in the second half of last year.
- New job opportunities: The CBI found that unemployment fell by 35,000 in the three months to March. While this drop is a positive factor, reducing the number of jobless people to 5.5%, it is also the slowest fall since summer 2013.However, in what is described as a "firmly embedded" economic recovery process, the CBI found that businesses are now better able to offer new job opportunities. "As a result, the majority of people moving into work took up full-time positions with an employer, rather than working for themselves."Interestingly this is at odds with earlier findings, specifically those released in July of last year, when CBI data found “large increases” in self-employed people and an uplift in new business owners. An increase in self-employment is sometimes seen as a negative outcome due to its connotations with employees leaving full-time work due to redundancy or company insolvency. This is of course a very one-sided view; but regardless, with companies expanding and taking on more full-time staff, flexible workspace operators have a significant opportunity to support these growing firms by helping them to upscale in a way that is both flexible and cost-efficient.
- Pay growth: Focusing on those in work, the CBI found that pay growth has risen again, which it claims is driven by the private sector: "Annual growth in private sector regular pay, which excludes bonuses, sped up from 2.2% in the three months to February to 2.7% in the three months to March. The last time annual growth in regular pay was higher was the three months to February 2009."
There are many different ways in which we can see these findings unfolding in the flexible workspace market; perhaps none more evident than the rapid expansion of the sector itself.
The BCA continues to track the great gains made by the industry since it released its Serviced Office Review in 2014, while other favourable findings are also coming to light.
Most recently, research released this week by Deloitte Real Estate suggests that the UK serviced office market has grown by 67% over the last 10 years, and now comprises five million square feet in Central London alone.
Deloitte’s head of tenant representation, Chris Lewis, added his perspective on what the fle