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U.K. Job Market Faces ‘Slow, Painful Contraction,’ CIPD Says

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Nov. 14 (Bloomberg) -- An index of U.K. employers’ hiring intentions weakened as the crisis in the euro region damped demand for labor, the Chartered Institute of Personnel and Development said.

The gauge fell to minus 3 in the fourth quarter from minus 1 in the previous three months, CIPD, an association for human-resource professionals, said in a report published today in London. The results are taken from a survey conducted by YouGov Plc of more than 1,000 employers.

The findings add to evidence that the European sovereign-debt crisis and U.K. government plans for the biggest fiscal squeeze since World War II are weighing on the labor market. Government data this week may show claims for jobless benefits rose for an eighth month in October. Bank of England Governor Mervyn King will present new economic forecasts at a press conference on Nov. 16 in London.

“The figures point to a slow, painful contraction in the jobs market,” with some employers reacting to “increasing uncertainty as a result of the euro-zone crisis and wider global economic turmoil,” Gerwyn Davies, public-policy adviser at CIPD, said in the statement. “There is no immediate sign of U.K. labor-market conditions improving in the short or medium term.”

Growth Plan

Claims for U.K. unemployment benefits increased 21,000 last month following a reported 17,500 gain in September, according to the median estimate of 24 economists in a Bloomberg News survey. The Office for National Statistics will publish the October data at 9:30 a.m. on Nov. 16.

Treasury minister Mark Hoban said the government is looking at measures to aid growth and that low interest rates have helped households plan their spending.

“When we publish the next plan for growth at the end of this month, that will send further signals to businesses and to households,” Hoban told BBC Radio 4 today. “There will be a range of measures -- I am not going to preempt those announcements -- but we recognize areas where we need to take further action to help businesses.”

In a separate report today, the Confederation of British Industry and recruitment company Harvey Nash Group Plc said about 47 percent of employers expect staff numbers to be higher in 12 months’ time. About 19 percent expect them to be smaller, the groups said in a biannual survey. The survey questioned 462 U.K. employers between August and September.

To contact the reporter on this story: Jennifer Ryan in London at

To contact the editor responsible for this story: Craig Stirling at

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