Experian's latest Insolvency Index has indicated that UK businesses are as strong financially as they have been since July 2008. Active businesses recorded an average ‘financial strength' score of 81.14 in October, compared to 79.8 in October last year. Very small businesses (1-2 employees) proved strong as they formed only 0.06% of business failures last month. Rolf Hickman, of pH, an Experian company, commented "...Throughout 2008, the average financial strength score had been seeing a downward trend, but 2009 has seen a reversal. The financial solidity of UK businesses has been improving over the year." Although insolvencies were up slightly in October, they should begin to ease as the financial strength of companies continues to improve.
As business conditions in the Eurozone continue to improve, the outlook for jobs is not yet so positive. The Markit Eurozone Manufacturing PMI (purchase managers' index) reported that manufacturing output grew for the third successive month in October, which represented the strongest monthly expansion since the beginning of 2008. France and Germany recorded the strongest output growth, whilst there were falls in output in Ireland, Spain and Greece. Chris Williamson, Markit's Chief Economist, stated that "...Business conditions in the eurozone manufacturing sector improved for the first time since May of last year, driven by accelerating growth of output and new orders, and moderating job losses." Furthermore, the lack of strength in this recovery was underlined by continuing job losses.
The ONS's latest figures for the public finances have placed more pressure on jobs in the public sector. With net debt (October) at £829.7bn - 59.2% of GDP, organisations such as the British Chambers of Commerce have called for a leaner public sector and for a freeze in public sector pay while inflation remains low. Recruiters are predicting some opportunities for HR and employee relations specialists in the short term, whilst a longer term need for change management and organisational development specialists is also forecast.
Financial recruiters may be worried about recently announced plans to curb bankers' bonuses. As the Chancellor of the Exchequer told one newspaper that the FSA would be given powers to ensure that bonuses cannot cause instability to the financial systems, Paul Goodman at Goodman Masson dismissed this idea as electioneering and added that such a move might "...raise concerns over whether international talent would come to the UK". However Andrew Evans at Morgan McKinley advised that it would be wise to see the details of such proposals and similar moves in other financial centres before pushing the panic button.
The latest CBI/Harvey Nash employment trends survey has reported a "big surge in demand" for temporary staff and Harvey Nash's Chief Executive Albert Ellis predicts that many of these temporary hires will follow a trend of becoming permanent. Nigel Parslow of Harvey Nash also revealed that financial services, technology and professional services have seen the most significant increase in demand, with Ellis adding that "...It won't be long because employers will come up against capacity constraints, and so accounting and back office jobs will pick up."
There was even better news in the retail banking sector from Hays this week, which reported a growing demand for roles in the sector as well as increased demand in restructuring and recovery in corporate and commercial banking, as well as distressed debt specialists and business development. Tessa Hollingworth from Hays revealed that the company is experiencing increased demand from major retain banks and building societies. This demand is across the board - senior and junior roles - and Hollingworth advised candidates that "...Organisations will look carefully at an individual's work history - evidence of loyalty to an employer is advantageous. Prior experience is preferred for more senior roles, although for the more junior roles the right attitude is just as important."
Finally this week there was some fantastic news for Hays Accountancy and Finance as it was named Recruitment Consultancy of the year at the CIMA awards last night.