Businesses optimistic about job creation in 2018

Companies remain optimistic about their ability to generate jobs in the short-term, building on the UK’s record labour market performance, a survey has revealed.

According to the latest CBI/Pertemps Network Group Employment Trends Survey, with 299 respondents employing around 1 million people, 51% of firms across the UK will grow their workforce in the year ahead, with confidence highest amongst small and mid-sized firms (58%).

And 93% of respondents reported that a diverse and inclusive workforce is important to the future success of their organisation – up on 76% in 2016.

But the survey, carried out between August and October 2017, warns that delivering further jobs growth depends on businesses being confident they can remain competitive if they choose to base staff in the UK.

Nearly two thirds (63%) currently believe that changes in the UK labour market will contribute to Britain becoming a less attractive place to invest and do business over the next five years – up from 50% last year and 25% in 2015.

Skills gaps were found to be the single most prominent worry facing firms, with nearly four in five (79%) respondents highlighting this as a worry – up from 64% in 2016. Access to overseas workers is a big contributor to this, with nearly half of respondents (49%) identifying uncertain access to labour supply – up from 35% in 2016 as a concern.

Neil Carberry, CBI managing director for people policy, said:“Britain’s record on job creation is second to none, and this year’s survey shows that this is set to continue in 2018. But with softening economic growth matched with high employment, the survey again emphasises the vital need to make progress on the Industrial Strategy and secure a good Brexit deal to improve productivity, support job creation and boost pay growth.

“The survey also shows that firms are concerned about finding the right staff in the future and this is damaging the outlook for investment in the longer term. It’s essential that businesses work to address skills gaps with colleges and other providers – but with high employment rates, domestic training alone can’t meet all our needs. Firms will need to be able to access people from outside the UK to support future growth and deliver the Industrial Strategy.

“With businesses already worried about future access to skills and labour, the worst thing we could do would be to undermine the many EU nationals already here and contributing to our businesses and public services. Last week’s Brexit deal is a good outcome if a final deal is reached, but the Government must be clear that the position of EU nationals already in the UK is secure in all scenarios.”