Pay and growth going in right direction, says survey

Findings from a national Chamber survey show that many businesses have increased employees’ pay over the last year, and most remain optimistic about growing their workforce over the next 12 months.

The survey of almost 3,000 businesses revealed that SMEs and those in IT, energy and construction are most positive about creating new jobs.  Also, small firms are more likely to have increased wages above inflation, while a greater proportion of larger firms kept wages in line with inflation.

Encouragingly, many firms already offer flexible and remote working, which highlights the vital role this plays in promoting business productivity and growth. However, businesses report that a major threat to jobs growth is employment regulation, such as the new right for employees to request flexible working and increased paternity leave and pay, which can be time consuming and costly to implement.

Key findings:

  • 34% increased pay above inflation last year (38% among small firms);  however,38% of micro businesses said pay was unchanged
  • 25% increased pay in line with inflation, most common in mediums (35%) and large firms (31%)
  • 57% pay at least Living Wage (not to be confused with Minimum Wage), with catering and accommodation sector least likely to pay to all staff.
  • Smalls (61%), mediums (60%), IT (74%), energy (71%) and construction (63%) sectors most likely to increase workforce in next 12 months
  • Arts & recreation (27%), catering and accommodation (36%) and education (40%) least likely to create jobs
  • 62% offer flexible working;  48% say the new statutory right to request it will harm their business;  17% feel it will have a positive contribution
  • Increased paternity leave and pay (60%), shared paternity/maternity leave (47%) and pension auto-enrolment (32%) will adversely affect their business
  • 38% offer remote working; 13% offer childcare provision
  • 11% offer zero hour contracts; 18% say banning exclusivity clauses tying workers to one employer will have a negative impact; 60% said it would have no impact.

Paul Mackie, President of Bradford Chamber of Commerce, said:

“It’s good news that businesses are optimistic about growth and pay prospects, despite the recent slowdown in economic recovery.  It is important that we can find workers with the right skills to respond to that optimism, and programmes like our own E3 scheme is all about that. The increasing concern towards additional employment regulation shows that this can be time-consuming and costly, and could affect bottom line and hamper future growth. With flexible working already being offered by the majority, legislation here is unnecessary and would increase business costs. More engagement with business may help prevent unnecessary regulation in the first place – or at least lead to a simpler process for firms implementing the regulation.  Childcare provision is patchy, at best, although locally we already have a scheme similar to that being proposed by the British Chambers as part of its election manifesto.”

See BCC’s infographic of the survey here.

Written on 29th October 2014Lillie Geistdorfer. Published in Current Issues, Economy, Employment, Lobbying, News