Employment above pre-pandemic and vacancies surge – business news 14 September 2021
James Salmon, Operations Director.
Employed hit pre-pandemic levels and vacancies top a million. Back in the office. Half of UK firms plan to increase their workforce. ‘Proper pay rise’ would fix shortages. MPs call for independent insolvency regulator. Household finances set for triple whammy of inflation, tax rises and benefit cuts. ” Tax system is ‘almost unworkable’ and other business news.
Employed hit pre-pandemic levels and vacancies top a million
Job vacancies hit a record high of one million as the economic recovery continues, according to official figures.
The number of vacancies in the three months to August rose 35% to above one million for the first time since records began in 2001 with companies battling staff shortages created by Brexit and lock-downs.
Strength in the jobs market gives an early indication that the economy may be able to absorb many of the 1.6 million that remain furloughed as that program comes to an end this month.
The figures also showed employee numbers were back at pre-pandemic levels in August, the Office for National Statistics (ONS) said with August payrolls showing another monthly increase of 241,000 employed to a total of 29.1 million.
Overall, the unemployment rate fell from 4.7% to 4.6% in the three months to July
The ONS deputy statistician, Jonathan Athow, said: “Early estimates from payroll data suggest that in August the total number of employees is around the same level as before the pandemic, though our surveys show well over a million are still on furlough.
Back in the office
The office is back as occupancy rates in major British cities rose to 90% from just 58% a week earlier.
£650bn jobs scheme will help build back better
With the Government said to be looking to shift focus from the pandemic toward efforts to boost the economy and level up the country, Boris Johnson has launched a £650bn initiative which ministers say will deliver 425,000 new jobs a year over the next four years. The Prime Minister said the Infrastructure Pipeline will create opportunities for apprentices, technicians, graduates and skilled workers, commenting: “From entry-level roles and post university careers, we’re creating the jobs this country needs to build back better following the pandemic.” Commenting on the Government’s ambitions, Work and Pensions Secretary Therese Coffey told BBC Breakfast: “Having done the jabs, we want to continue to try to get people into jobs”.
Half of UK firms plan to increase their workforce
A survey from employment firm Manpower Group has found that a record number of firms are planning to hire more staff before the end of the year, with half of employers looking to increase their workforce in Q4. Manpower says the national employment outlook is at an all-time high of 32%, with this marking a 39-point increase from the end of last year in a system where a positive number indicates that more employers plan to increase rather than cut staff numbers.
TUC: ‘Proper pay rise’ would fix shortages
TUC general secretary Frances O’Grady says improving pay and conditions for delivery drivers would help address a shortage of staff that has hit the supply chain. Speaking at the TUC Congress in London, she reflected on how to tackle problems with the supply of goods, saying: “Well, here’s a novel idea – let’s make that industry deliver decent conditions, direct employment and a proper pay rise.” She also argued that pay rises were crucial for the Government’s “levelling up” agenda, saying: “After decades of real wage cuts… no-one can seriously say working people don’t deserve a pay rise.” Ms O’Grady, who suggested a rise in capital gains tax could fund an increase in pay for care workers, has also called for a furlough-style scheme to be permanently in place “to keep people in good jobs”. Separately, Ms O’Grady has urged ministers to reconsider an increase in National Insurance contributions, telling BBC Radio 4’s Today programme that shifting tax to wealth instead may offer a boost in demand for the economy.
MPs call for independent insolvency regulator
MPs on the All-Party Parliamentary Group on Fair Business Banking have voiced concern over the insolvency profession after an inquiry found evidence of alleged widespread misconduct, saying it has received “startling” evidence about the sector. Kevin Hollinrake, co-chairman of the parliamentary group, said that sections of the insolvency industry were “operating in a manner that it is more akin to the Wild West than a developed western economy.” He warned that insolvency practitioners “often prioritise the interests of their bank panel paymasters at the expense of other creditors and shareholders”, describing this as “totally unacceptable” and a “clear breach of their duty of care”. The behaviour “is not being addressed by the membership organisations whose responsibility it is to regulate them”, he added. With the industry overseen by recognised professional bodies such as the ICAEW and Insolvency Practitioners Association, MPs are calling for an independent regulator with an ombudsman. Colin Haig, president of R3, the trade body for insolvency professionals, said: “The UK’s insolvency and restructuring profession is one of the most regulated and well-regarded in the world”.
Household finances set for triple whammy of inflation, tax rises and benefit cuts
Tim Wallace in the Telegraph says households face losing £900 a year in 2022 as tax increases, benefit cuts and rising inflation squeeze household finances. He highlights that inflation is forecast to hit 3.5% in early 2022, a rate well above the Bank of England’s 2% target, with this coming just as the 1.25% National Insurance increase comes into force. Those receiving Universal Credit are set to see their finances take an additional hit as a £20 per week increase added as a temporary measure amid the pandemic expires next month. Martin Beck, chief economic adviser to the EY Item Club, said lower income households will bear the brunt, saying: “It is going to hit their spending more than the better off who can cover some or all of the cost by saving less or drawing on their savings.” He added that households face “a triple whammy of inflation, tax rises and benefit cuts.”
Covid
The government is expected to confirm that booster jabs will be offered to over 50s and the most vulnerable as part of its winter plan. The booster jab will be a single jab of the Pfizer vaccine.
Tea
Advent/ GIC is in advanced talks over a £4bn offer for Unilever’s tea business and brands including Lipton and PG Tips. Unilever is understood to have received rival offers from KKR and Carlyle.
Ocado
Ocado Retail Q3 trading statement said the fire at Erith CFC on 16th July had caused a 19% revenue decline in the last 7 weeks of the quarter. Revenue overall declined 10.6% v a 54% growth in Q3 2020
Tax system is ‘almost unworkable’
In a letter to the Times, Blick Rothenberg CEO Nimesh Shah suggests the Government “needs to step aside when deciding on the future of Britain’s tax policy”. Arguing that successive governments have “tinkered too much with tax for perceived political gain and we are left with an almost unworkable tax system”, he says officials “would do well to rip it up and start again”. Reflecting on the new Health and Social Care Levy, he says it is “here to stay and is ripe for being increased and broadened”, suggesting it will be a “valuable tool to turn on the ‘tax tap’ when further tax revenue is needed”.
Michael Jack, a former Financial Secretary to the Treasury and chairman of the Office of Tax Simplification, says recent governments have “shied away” from a “grown-up conversation” about the best and fairest way to raise the money needed to run the UK’s public services. Writing to the Times, he says governments “are frightened that such a debate would be seen as the precursor to higher taxes, not the dawn of a better tax system.” He adds that it “also reflects a reluctance to embark on major structural changes to the tax system.”
UK trend could prompt takeover spree
CEOs of global companies are eyeing takeovers and mergers, with a trend seen in the UK set to expand to other markets. Data from Schroders suggests that the pandemic and Brexit have seen UK companies undervalued by around 30%, with this driving a surge in takeovers and mergers of UK firms. The $343.1bn worth of mergers and acquisitions completed since the start of the year has seen double the volume of deals recorded in 2019, with the total the highest since 2000. Reflecting on the climate for deals, Chris Biggs at Theta Global Advisors comments: “2021 is proving to be a record year for M&As and other kinds of deals as a large amount of uncertainty melts that has lingered from Covid and Brexit. It is a perfect storm of returning optimism, loosening restrictions and undervalued firms”.
House price growth set to see North-South divide
House prices are set to rise by 0.7% over the next three months, with October expected to lead the increase with growth of 1.3%, according to the Reallymoving House Price Forecast. The report says prices are in line to fall 0.5% this month and, following a jump in October, slip 0.1% month-on-month in November, with the average price hitting £341,492 over the next three months. According to the data, prices will be 4.3% higher year-on-year in September, with a slight drop of 0.1% in October before a 1.9% increase in November. The Reallymoving study suggests the changes in house prices will see a North-South divide, with London set for a 0.1% increase in prices, while those in the South East climb 1.9%. However, prices in the East and West Midlands will dip 2.2% and 1.3% respectively, while the North East sees a 3.3% dip and prices in the North West fall 1%.
Why should you become a CPA member!
The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid since 1914. We have seen many financial crises, this one will be particularly deadly for suppliers for some time to come.
CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. And we provide credit information so you can monitor and assess your key customers.
Unlike other credit management companies, we charge our members a fixed annual subscription irrespective of how high the debt value is!
It takes less than 17 minutes to see how you would benefit, do you have the time now?
No face-to-face meeting required – just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.
When you see your money come in, you will be so glad you used CPA.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Get compensated for previous late payments
Have you been paid late by business customers in the last six years?
Maybe you no longer work with them. Under legislation, you are entitled to compensation you for those late payments you have suffered.
You put up with the PAIN – now claim the GAIN!
Claim late payment compensation (LPC) from former business customers who paid you late in the last six years!
CPA (LPC) Recoveries is using our bespoke software and decades of experience to do just that for our clients
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.