Half of British firms are planning to expand their workforce in 2015 claims new report

22nd December 2014

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Half of British firms are set to expand their workforce in 2015, and permanent jobs are likely to outstrip temporary work a new report has claimed.

The survey conducted by business organisation, the Confederation of British Industry (CBI) and Accenture found that jobs growth is expected in every region of the UK, with Scotland leading the way.

In addition it concluded that job prospects for young people have improved on last year with many firms planning to recruit graduates and apprentices in 2015.

The survey, which covers 323 businesses employing a combined total of more than 1.25m people, however also raised concerns over skills gaps that could prevent some jobs being filled – which it has said is the biggest workforce threat to UK competitiveness. Worries about new regulation damaging job creation in the country’s labour market came a close second.

READ MORE: Bank of England MPC member expects bigger salaries for Britons to arrive in 2015

Additionally, the survey revealed that pay rises are anticipated in 2015, though at a cautious rate, with 43% of firms planning a rise in line with the Retail Price Index (RPI).

But there has been a small increase in the proportion of companies expecting to pay above RPI when compared with the firm’s last survey – 12% in 2014 compared to 7% in 2013. Competitive pressures and weak productivity continue to hold down pay increases – containing labour costs is one of the top three workforce priorities next year.

Commenting on the analysis Katja Hall, CBI deputy director-general, said: “Businesses are planning to create jobs in every region of the UK next year as the recovery continues, and more and more of those jobs will be permanent. The outlook for young people is also looking brighter as firms look to boost their graduate in-take and expand apprenticeships.

“We want to see everyone enjoy the rewards of the economic recovery. Growth should work for everyone, and skills are the key route to ensuring that this happens through improved productivity and pay.”

However Hall added that it is a concern that the UK’s growing skills gap is now seen as the number one workforce threat to the long-term health of its economy.

She added: “Companies and the Government need to work together to find ways to develop skills within the workforce and help employees move into higher skilled and better paid jobs.

“Those in regular work through the year saw wages rise this year and this trend will continue in 2015. Overall, for those in regular work, wage increases have broadly kept pace with inflation, although those with more broken employment histories have seen little respite.”

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