Business Hiring Rates ‘Sky-High’ Despite Static Productivity Levels
UK business optimism and hiring intentions remain strong, yet economic concerns remain as workers productivity levels fail to grow
Confidence among British businesses remains strong with hiring and optimism rates revealed to be significantly above long-term trends, measuring 113.0 and 104.9 respectively on accountancy firm BDO LLP’s Business Trends Index report.
Despite these high optimism and recruitment levels the report also found that several economic concerns still remain.Business productivity – workers’ output per hour – has continued to stagnate over the past two years and the BDO claims productivity levels for UK enterprise are now at their lowest since World War 2.
The report did however shine a positive light on the UK business atmosphere, with the BDO’s Output Index rising to 103.9 and its Inflation Index decreasing from 94.7 to 93.8 this month – signifying deflation.
Peter Hemington, a partner at BDO LLP, commented on the report findings:
“While it is encouraging to see strong business confidence, the UK’s continuing poor labour productivity performance is a very significant concern.
“Although employment growth in recent years has been strong, much of this has been in part-time jobs. Productivity ultimately determines our prosperity so it is a crucial area that must be addressed. Policymakers of all persuasion must take on this productivity puzzle.”
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