Northern Powerhouse ‘failing’ as North West job prospects plummet to lowest level, new report finds

The government’s flagship ‘Northern Powerhouse’ scheme has ‘so far failed’ with employment prospects in the North West at their lowest level in two years, according to a new report.

The Manpower Employment Outlook Survey uses feedback from employers to ascertain the likelihood of employers increasing or decreasing their work forces in the coming quarter, and is used by both the Bank of England and the government as an economic statistic.

The North West’s employment prospects currently stand at 0% – a 7% drop on the previous quarter, and 4% below the national average.

Greg Hollis, Operations Manager at Manpower UK, says that the study represents a ‘challenging picture’ for jobseekers in the North West, but adds that there are opportunities for skilled individuals.

“We are seeing a marked divide between job prospects across the north and those in London,” he said.

“That is a clear sign that the Government’s plans to rebalance the economy through the creation of a Northern Powerhouse have so far failed to ignite.

“While the overall Outlook in the North West has dropped off since last quarter, those with the right skills are finding opportunities.

“For example, in Manchester, we are seeing strong demand for employees in financial services and for salespeople to work in call centers.

“In-demand applicants can be selective about the roles they apply for, and as competition between employers grows, the salaries they can expect to achieve are also increasing.”

The national jobs market is standing at its least optimistic for the past three years, with Manpower theorizing that the drop in hiring intentions in the public sector and the introduction of the National Living Wage have both affected employer confidence.

The latter is a policy introduced by the government that will raise the wages of six million people by 6% each year until 2020. However, the Office for Budget Responsibility estimates that the move could be the catalyst for 60,000 job losses.

Another consequence of the policy could see employers looking or cheap, inexperienced labour in sectors such as social care, something which James Hick, ManpowerGroup Solutions Managing Director believes may become a problem.

 “An unintended consequence of the introduction of the new Living Wage is that firms might try to bypass the legislation altogether,” he said.

“We anticipate that some employers may look to mitigate the extra costs by taking on more younger or self-employed workers, who are not entitled to the National Living Wage.

“While on the surface this could be good news for youth unemployment, which currently stands at 16%, it could push a greater proportion of young people into low skilled jobs, resulting in an influx of less experienced workers into social care and other sectors hardest hit by the new legislation.

“Meanwhile, candidates under the age of 25 have been asking us why it is they will be paid less despite doing equal work.”

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