As depressing unemployment figures from the Office for National Statistics hit the headlines, many PAYE umbrella contractors may be feeling disheartened for 2011. However, the latest “JobsOutlook” from the Recruitment and Employment Confederation (REC) offers a more hopeful prospect for freelancers in umbrella companies, revealing that 86 per cent of private sector employers are planning to maintain or expand staff on agency payroll.
Unemployment rose by 44,000 during the last quarter of 2010 to hit 2.5 million, a figure which includes 965,000 young people aged 16-24. Altogether, 7.9 per cent of the adult population in the UK is currently jobless.
However, despite these dispiriting trends, optimism amongst private sector employers appears to have remained strong, according to the latest REC survey. 94 per cent of those polled said they were planning to increase or maintain at current levels their permanent staffing complement in 2011, and 35 per cent plan to expand their temporary workforce. Considering that only 22 per cent planned to do so last year, this represents a significant growth in confidence.
The REC’s Director of Research, Roger Tweedy, said that even though there is still concern over the UK economy, it is a “very positive sign” that so many private sector employers continue to turn to temporary staff, which include PAYE umbrella contractors, to deliver the flexibility they are seeking. He again expressed concern over the sheer scale of public sector cuts, which are yet to be fully felt. However, he also believes that in the long-term, “demand in the economy will lead to more private sector businesses employing more people,” which should largely make-up for the “public sector fall-out.”