Monday 26 November 2012

Winners and losers in the 2011-12 jobs market


I’m slightly hesitant about naming anyone in my blog at the moment. Within days of mentioning Clive Dunn, the Dad’s Army actor died at the age of 91. Last week’s Dallas themed post was equally swiftly followed by the death of 81 year old Larry Hagman. The latter was most famous for playing the character JR Ewing, whose fictional close encounter with death a generation ago meant that “Who Shot JR?” for a short while usurped “Who Killed JFK?” as the question most associated with the Texan city. It was therefore somehow fitting that Mr Hagman passed away on November 23rd, just one day after the 49th anniversary of the assassination of the former United States president.

Back here at home 22 November saw the Office for National Statistics (ONS) release the latest Annual Survey of Hours and Earnings (ASHE). The results confirm the extent of the real pay squeeze between spring 2011 and 2012, with hourly median pay growth for full-time employees only around half the corresponding 3% rise in price inflation as measured by the Consumer Prices Index. But with the national minimum wage helping to support pay in the lower half of the earnings league, the top 10% of earners felt the biggest squeeze. The pay of full-time employees in the bottom tenth of the distribution increased by 2.3%, while pay for those in the top tenth fell by 0.2% (i.e. a real hourly pay cut of 3.2%).

My initial response to this was that although the pay gap between top, middle and low earners remains very wide in the UK and is still far wider than a generation ago, 2011-12 has as least turned out to be something of a ‘we’re all in it together’ year in Britain’s jobs market with pay at the top hit hardest by the double dip recession. However, I was also interested to see how pay growth between spring 2011 and 2012 compared with employment growth during roughly the same period (April-June in each year), as discussed in my blog posting of 12 November which listed the top 10 fastest growing occupations in the past year and the 10 occupations recording the biggest loss of employment.

Growing demand for certain types of labour might result in a combination of relatively strong growth in both employment and pay, or vice versa where demand is weak. But it’s also possible that faster or slower pay growth could help price some types of workers out of or into jobs, thereby causing pay and employment growth to diverge.   

Although the ASHE lists the number of jobs in each occupation as well as pay and hours these are considered indicative rather than accurate estimates, so it’s best to compare the ASHE results with the broadly corresponding Labour Force Survey employment estimates.

Listed according to their position in the Standard Occupational Classification (SOC) the 10 fastest growing occupations saw the following percentage change in median hourly earnings for full-time employees: Production Managers and Directors in Manufacturing (+1.1%), Human Resource Managers and Directors (+2.2%), Information Technology Specialist Managers (-0.5%),  Management Consultants and Business Analysts (-0.3%), Quality Assurance and Regulatory Professionals (-2.8%), Graphic Designers (+1.0%), Financial Accounts Managers (+0.7%), Credit Controllers (+0.5%), Chefs (+0.5%) and Sales and Retail Assistants (+1.9%).

The corresponding changes for the 10 occupations registering the biggest jobs losses are: Financial Managers and Directors (+0.2%), Chartered and Certified Accountants (+5.5%), Youth and Community Workers (-2.8%), Local Government Administrative Occupations (+0.8%), Typists and Related Keyboard Occupations (+1.8%),  Electricians and Electrical Fitters (+0.1%), Plumbers and Heating and Ventilating Engineers (-0.5%), Teaching Assistants (+2.5%), Nursing Auxiliaries (+1.4%), Security Guards and Related Occupations (+0.8).

Interestingly the only one of these 20 occupations to register a real hourly pay increase, Chartered and Certified Accountants, was one of the biggest job shedders (down 39,000 or 16.8% on the year), suggesting that this group was content to trade-off higher pay against jobs. The biggest losers are Youth and Community Workers, who suffered a 5.8% real hourly pay cut as well as shedding 25,000 jobs, a 30% reduction in numbers. Of the remainder, Human Resource Managers and Directors is the occupation that fares best (a modest hourly pay cut of 0.8%, alongside employment growth of 22,000, or 19.2%), indicating relatively strong demand for this group. Ironically, therefore, HR managers and directors, who are employed to deliver news about pay and job cuts to others in the workplace, have of late been keeping the best news for themselves.  

4 comments:

  1. Have 1 in 6 accountants lost their jobs in the last 18 months? As a newly qualified accountant myself this is a little disconcerting, but I don't get a sense of it from people I know in recruitment. Sure, there have been many lay-offs, especially in areas such as advising on mergers and buy-outs, but 1 in 6?

    Where's the source of this information? I couldn't see it on the ONS website.

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  2. Is on the ONS website - though I admit ONS website not the most user friendly

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  3. I looked into the figures and found 5 or 6 ONS job categories that an accountant might be involved in, plus several more finance related roles:

    1131 Financial managers and directors
    2421 Chartered and certified accountants
    2422 Management accountants (2010 only)
    2423 Management consultants and business analysts
    (in 2010 this included actuaries and statisticians)
    3534 Finance and investment analysts and advisers
    3535 Taxation experts

    3537 Financial and accounting technicians
    4121 Credit controllers
    4122 Book-keepers, payroll managers and wages clerks
    4124 Finance officers
    4129 Financial administrative occupations n.e.c.4 (new in 2011 figures)

    Total of all the above:
    2010: 1417
    2011: 1452
    2012: 1461

    There was a 17% reduction in chartered accountants in 2011-12 but it may just be a question of definition as some other categories increased in number. However, there appears to be a slight reduction in higher-level finance roles over the 3 years and an increase in more junior roles, which is surprising as technology ought to steadily reduce the need for junior roles (I've seen that happen), but it goes with the lower productivity in the economy. Credit controllers were up 20,000 which is not surprising when companies need all the cash they can get and this is not a job that can be automated.

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    Replies
    1. Glad you found it and thanks for broadening the discussion

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