LONDON, Nov 10 (Reuters) – British employers expect to raise wages by 3% in the next 12 months, but some recruiters expect artificial intelligence to shrink their workforce, according to a survey that showed firms were worried about the impact of government tax plans on hiring.<\/p>\n
The Chartered Institute of Personnel and Development, a professional body for the human resources sector, said overall hiring intentions were around the weakest since the pandemic, and were especially low in the public sector.<\/p>\n
Sign up here.<\/a><\/p>\n One in six employers expect the use of AI tools will allow them to reduce their headcount in the next 12 months.<\/p>\n Of those, a quarter expect the staffing reduction to be greater than 10%, with junior managerial, clerical, professional and administrator roles expected to be the most affected.<\/p>\n The CIPD said finance minister Rachel Reeves should avoid further measures that will dampen hiring in her November 26 budget, after she announced a big rise in employers’ social security contributions last year.<\/p>\n James Cockett, senior labour market economist at the CIPD, said people looking for jobs were already feeling the impact of slower hiring since Reeves’ first budget.<\/p>\n “We need to see a stronger focus by the government and employers on longer-term workforce planning and investment in skills to help people use AI effectively in their roles or transition into different jobs or occupations as AI use grows,” Cockett said.<\/p>\n The CIPD said that across the more than 2,000 businesses it surveyed, the median expected increase in staff basic pay was 3%, where it had been for six consecutive quarters.<\/p>\n A Bank of England survey<\/a> of employers released on Thursday showed expectations for wage growth ticked higher to 3.7% in the three months to October, the highest reading for five months.<\/p>\n Official labour market figures are expected to show a small slowdown in wage growth on Tuesday. Economists polled by Reuters forecast regular pay in the three months to September to have increased by an annual 4.6%, slightly below the 4.7% rise in the month before.<\/p>\n British wage growth tends to be faster than growth in pay settlements, as the latter does not include gains made by workers who move to better-paid jobs.<\/p>\n Although the BoE held interest rates at 4%<\/a> last week and signalled it could be on course to cut rates at its next meeting in December, it is still closely monitoring pay growth which could push up inflation.<\/p>\n The CIPD survey took place between September 19 and October 14.<\/p>\n Reporting by Suban Abdulla; editing by David Milliken<\/p>\n Our Standards: The Thomson Reuters Trust Principles., opens new tab<\/a><\/p>\n