Number of employers expecting to make redundancies increases by 50 per cent

News Article

The number of employers expecting to make redundancies in the third quarter (Q3) of 2020 has increased by 50 per cent, according to the latest research.

The data comes from the Labour Market Outlook compiled by the Chartered Institute of Personnel and Development (CIPD) and Adecco Group and found that the number of firms expecting to make job cuts has surged since the second quarter of the year.

The figures state that 38 per cent of private-sector employers believe they will make redundancies, which is more than twice as high as the figure in the public sector (16 per cent).

However, hiring confidence has increased since Q2, rising to 49 per cent from 40 per cent in the previous quarter, but experts have stated that employment confidence has decreased year-on-year.

There is also a significant variation in the confidence in different sectors, with healthcare and public administration seeing the highest levels of confidence and manufacturing and administrative support services also seeing a positive increase.

Gerwyn Davies, Senior Labour Market Adviser at the CIPD, said: “Until now, redundancies have been low – no doubt due to the Job Retention Scheme – but we expect to see more redundancies come through this autumn, especially in the private sector once the scheme closes.

“Hiring confidence is rising tentatively, but this probably won’t be enough to offset the rise in redundancies and the number of new graduates and school leavers entering the labour market over the next few months. As a result, this looks set to be a sombre autumn for jobs.”

Samantha Randall, an Associate Solicitor with Palmers who specialises in employment law, said: “It is important to remember that there are strict rules which employers must follow when making redundancies.

“If you do not follow a reasonable procedure during the dismissal process, an employee might be able to take legal action against you and seek compensation.

“Although employees must have held their job for at least two years prior to being dismissed, to earn the right to challenge their employer, there are a number of automatically unfair dismissals which do not require a set continuous service period.”

For more information about how Palmers Solicitors can provide advice on all aspects of redundancy and employment law, please contact us.

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