The impact of the global economic slump is still being felt among eight out of 10 employers, leading to falling levels of staff morale and ever-growing fears for the future among senior managers.
According to the new ‘Economic Outlook’ report written by Lord John Eatwell, chief economic adviser to the Chartered Management Institute, even though the UK economy has officially moved out of recession, some 41% of senior executives believe that their business operations continue to be severely hampered by its effects.
Nearly two thirds reported that levels of staff morale have worsened over the last six months, while job insecurity among business leaders is at record levels. Some 44% now feel they may end up in the dole queue compared with only 27% six months ago.
The situation is also not being helped by the ongoing reduction in the availability of long-term finance as reported by 42% of senior managers and in lower levels of short-term investment, which is affecting 40%.
Such a scenario means that nearly half of all organisations have kept pay freezes in place in a bid to keep costs to a minimum, while 52% have closed their doors to new recruits – despite assertions by some experts that the jobs market is improving. A further 56% have also cut investment in management skills training.
To make matters worse, confidence in the future has plumbed new depths. A huge seven out of 10 bosses expect business insolvencies to increase over the coming months, while only 28% expect employment levels to rise.
Eatwell said: “British management faces major challenges: in securing the funds and the skilled labour necessary to sustain efficiency, in maintaining morale in their organisations and in developing the vision and commitment to the investment needed to rebalance the British economy.”
As a result, he called on the government to provide tax breaks to enable employers to invest in skills and to introduce measures to improve bank lending to businesses. The study indicated that eight out of ten managers backed such moves.
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