16 Asian LEADER
1Jan - 14 Jan 2014
BUSINESS & FINANCE
Jobs growth could see rates review
E
mployment could grow by half
a million in 2014, triggering a
review of the Bank of England’s
monetary policy earlier than expected,
a report has predicted.
The Chartered Institute of Personnel and Development said the increase
in employment in 2013, which saw a
record 30 million people in work by the
end of the year, was set to continue.
Chief economist Mark Beatson said
there was a “high likelihood” that
employment will rise by more than
300,000 during 2014, and even by as
much as 500,000.
The improving jobs market could
push unemployment below 7%, the
rate at which the Bank could rethink
interest rates, leading to a review of
current monetary policy earlier than
expected, said the report.
Mr Beatson noted that 2013 was
the fifth year in a row when average
earnings fell in real terms, which was
“unprecedented” in at least the last 70
years
“This time last year we were talking
about the UK’s ‘jobs enigma’. Since
France’s 75% tax
rate gains approval
by top court
F
then, labour market performance has
continued to exceed expectations,
turning the UK labour market into a
jobs machine.
“Employment growth looks set to
continue at an impressive rate over
the year to come. However, the downside is that UK productivity has yet to
improve and remains below its prerecession level.
“A lot of attention is being given to
falling real wages and the UK’s ‘cost
of living crisis’, for understandable
reasons. But not enough attention is
given to the main reason why this has
happened - that productivity has fallen since 2008.
“Skills shortages in certain sectors
may inflate wages for some, but if we
are to create any realistic prospect of
wages rising in real terms across the
board, we need to improve productivity,” he said.
he real value of average earnings has fallen
by almost 14% since the
recession five years ago, an
“alarming” new study has
shown.
The figure is higher in
some parts of the UK, at
more than 20% in London
and 15% in Yorkshire and
the Humber, according to
the study.
In some parts of the capital, the value of average pay
has slumped by almost 50%,
said the GMB union report.
The only part of the UK
where the figure has increased since 2008 is Moray
in Scotland, said the report,
which compared the increase in average pay with
the rise in RPI inflation.
Unions have been warning all year that wages have
failed to keep up with inflation, adding that workers
were missing out on the upturn in the economy, including an increase in jobs.
Paul Kenny, general secretary of the GMB, said:
“These alarming figu ɕ