The CIPD’s chief economist, Mark Beatson, is predicting that the UK economy will continue to deliver solid employment growth in 2016, potentially adding 500,000 new jobs – 100,000 more than last autumn’s Office for Budget Responsibility (OBR) estimate.
April’s introduction in the UK of the National Living Wage will not dampen the prospect of another record-breaking year for employment, said Mr Beatson.
“Last year we predicted that employment would increase by up to half a million during 2015, which it did. This year I think we will see a repeat, with another half million additional jobs.
“If the government provides the right support for those out of work, we may have the opportunity to reduce the unemployment rate to below 5 per cent, a rate we haven’t seen since 2005.”
The increased employment rate is also likely to bring with it modest pay rate rises, believes Mr Beatson. His analysis suggests that average wage growth will remain at around 2 per cent for most or all of 2016.
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