Are more redundancies on the horizon in 2013? by Mark Hodgson, Practice Leader, Right Management on 01-Feb-2013

Employees still face an uncertain future in 2013, as UK businesses are increasingly unsure if they will need to make redundancies over the next six months. According to a survey of 783 UK businesses by Right Management, the talent and career management expert within ManpowerGroup, around one in twelve UK employers (8%) are uncertain if they will need to make redundancies in the next six months. This figure has risen by six percentage points in the last six months, up from just 2% in 2012.

The survey also reveals a slight drop in those reporting they will make no layoffs at all; 77% of employers feel they will make no layoffs at all in the first six months of 2013, down from 81% in 2012. However, this is a higher figure than the global average of 69% and no employers reported they would make significantly more layoffs (down from 4% in 2012).

"The figures for the year ahead paint a mixed picture. As the UK economy remains flat and growth stalls, companies are becoming increasingly unsure if they will have to let staff go," says Mark Hodgson, practice leader of Talent Management in Right Management UK & Ireland. "In recent weeks, media headlines have confirmed a number of companies and household brands that have disappeared from our high streets. It would appear that businesses are losing confidence that they will get through the next six months without making redundancies which is concerning. Employers don’t want to lose talented staff but they often think that making redundancies is the only way they can cut costs."

Only 22% of UK employers believe their companies are very effective at redeploying employees rather than making redundancies. This is a global problem, almost three in ten employers believe their organisations are 'not too effective' or 'not at all effective' at redeployment.

"The results suggest that businesses aren’t seeing redeployment as a feasible way of making savings and keeping staff. Redeployment is an important way of ensuring that employers can cut costs without losing talent. Businesses can’t afford to underestimate the importance of a flexible workforce in this tough economic climate. Redundancies shouldn’t be the only option, employers need to consider alternatives rather than losing skilled and talented staff who they will want back when the economy picks up again."

These issues were explored by ManpowerGroup when they led discussions at the World Economic Forum Annual Meeting (in Davos) 2013. Jonas Prising, ManpowerGroup President says, "Companies everywhere must prepare for one certainty - uncertainty. This unpredictability requires the development of strategies that strike the right balance between the need for built-in flexibility of plan and results."

This global study on redundancy trends was carried out during the second half of 2012 in more than 42 countries and territories. It was conducted as part of the Manpower Employment Outlook Survey, which is the most extensive, forward-looking employment survey in the world. The redundancy trend data will be updated every six months and will serve as a barometer of workforce trends and activities.

For more information, please visit: www.right.com

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