CIPD responds to Autumn Statement and Growth Review

The Chancellor of the Exchequer delivered his 2011 Autumn Statement to the Parliament yesterday.

A wide-ranging package of more than 140 reforms was announced including the second phase of the Growth Review and the National Infrastructure Plan to build a stronger and more balanced economy.

The key announcements included:

Employer Ownership, a vocational training programme pilot – a programme that will give businesses the power to design, develop and purchase the vocational training programme they need, backed by up to £250 million by the Government.

Reform of adult basic literacy and numeracy provision – The Government will continue to fund literacy and numeracy courses for adults who lack basic skills, but has undertaken a major review of how provision is delivered, focusing on maximising labour market benefits.

National Careers Service – The Government will create an improved careers information portal as part of the National Careers Service from April 2012, through which the public can access up to date, employer sourced information on occupations, progression routes, qualifications and wages.

Kite-marking of courses – The Government will support the kite-marking of courses that employers value by a group of Science, Technology Engineering and Mathematics (STEM) focussed sector skills councils working with the CBI.

In response to the Autumn Statement, on the outlook for employment and the labour market, CIPD Chief Economic Adviser Dr John Philpott said: “the bad news is with economic growth remaining sluggish for some time to come, the OBR expects unemployment to remain above 2 million until the middle of the decade, which will put downward pressure on earnings growth across all sectors of the economy for several years to come.”

On proposals regarding employment legislation, Mike Emmott, employee relations adviser at CIPD, said: “Pitching employment deregulation as a major contribution to driving growth is at best a distraction and at its worst could undermine efforts to boost competitiveness and productivity.

“The UK has real deficiencies in management and leadership skills, and the CIPD is urging Government to focus less on giving employers implausible options such as ‘protected conversations’ to cover up for these deficiencies, and more on encouraging employers to develop and nurture these skills.”

On announcements on public sector pay and pensions, Charles Cotton, rewards adviser at the CIPD, commented: “The CIPD welcomes the Chancellor’s decision to ask the pay review bodies to look at how pay can be varied to better meet the needs of local labour markets, clients and tax payers.”

CIPD also welcomed the announcement of the ‘Youth Contract’ and the proposal to give employers greater ownership of the skills system.

Katerina Rüdiger, skills adviser at the CIPD, said: “If the youth contract is successful in widening the pool of employers who have recent experience of employing young workers, it will encourage more employers to take a more long-term approach to grow their own workforce, and future young people will benefit from the positive contributions made by this subsidised cohort of young people.”

Aastha Gill