Recruitment by private firms is being cancelled out by large scale job losses in the public sector, according to a new report.
The Chartered Institute of Personnel and Development (CIPD) said there was now a “sharp contrast” between job prospects in the private and public sectors, with employment set to grow in manufacturing and other firms.
The report, published ahead of new unemployment figures today, said that the number of organisations planning to make redundancies has risen to the highest level since the survey began in 2004.
More than half of public sector organisations predicted job losses in the three months to June, while almost a third of private companies were also making redundancies.
Gerwyn Davies, the CIPD’s policy adviser, said: “The jobs market appears to be taking baby steps on the long path to pre-recession levels. There are many sectors, such as manufacturing, that are taking large strides forward, but consumer-facing industries are simply edging forwards due to a fear of another consumer slowdown.
“Together with the onset of public sector cutbacks, the risk of an employment slowdown appears finely balanced.”
Malcolm Edge, of KPMG, which helped with the study, added: “Many businesses are very nervous about the rest of 2011. The recent VAT increase, low consumer confidence and falling disposable incomes have left businesses feeling the strain, and there’s added pressure from mounting fuel and utility costs.
“Despite that, some areas in the private sector feel confident enough to recruit, but with the public sector shrinking, the UK’s jobs market will continue to diverge.”
The report was based on a survey of almost 400 organisations, almost two thirds in the private sector.
In another report, HSBC bank said almost a third of workers felt their job was not secure over the next year, with older employees in the public sector feeling particularly vulnerable.
A survey of 2,200 adults showed that younger public sector workers felt more secure.
Richard Brown, of HSBC, said: “Obviously we are in a difficult financial period with many people feeling insecure about their job prospects and experiencing a squeeze in their standard of living.
“While this feeling of a lack of job security is particularly acute among older people in the public sector, everyone seems to be feeling the squeeze on their finances.”
Meanwhile Remploy, the leading provider of employment services for disabled people, today reported an “impressive” rise in the number of people it supported into work last year.
In the 12 months to the end of March the company found more than 20,000 jobs for disabled and disadvantaged people, compared with 10,600 in the previous year - an increase of almost 90%.
Beth Carruthers, Remploy’s director of employment services, said: “This is a remarkable achievement in a challenging economic environment with high unemployment and is a tribute to the extensive relationships we have with employers.
“Our outstanding success only serves to reinforce our belief in a fairer, more diverse society driven by greater inclusion and equality for disabled people.”
Almost one of three of the people supported into work by Remploy had mental health issues or a learning disability and around three quarters had been out of work for more than 12 months.