Workforce and management skills key to competitiveness says CBI survey

The Confederation of British Industry's annual employment trends survey, published in May 2000, shows that employers regard workforce and management skills as crucial to raising competitiveness. A large majority of employers said that the administrative burden of employment legislation had increased.

On 23 May 2000, the Confederation of British Industry (CBI) published its third annual employment trends survey, carried out in conjunction with consulting firm William M Mercer. The survey covers a wide range of labour market issues, including skills, regulation, employee involvement and "work-life balance". Some of its key findings are highlighted below.

As with the 1999 survey (UK9905106N), companies responding to the survey ranked high levels of workforce and management skills as the key drivers of competitiveness, well above factors such as the freedom to adjust the size of the labour force and low labour costs. However, the report comments that the lack of emphasis placed on low labour costs and numerical flexibility reflects the "current favourable environment" in the UK: "Were the UK government or the EU to impose significant increases in labour costs or restrict the ability of companies to adjust their labour force in the light of changing economic conditions, then the importance of these factors would grow."

Employers identified the quantity of new employment legislation (UK0004165N) as a major concern: 84% believed that the administrative burden of compliance with the legislation had either increased or increased a lot.

The most frequent form of "direct" employee involvement mechanism reported was meetings about quality issues (such as quality circles and organisational improvement groups) – reported by 62% of companies. As regards the extent of "indirect" or representative employee involvement, 56% of companies reported having a permanent information and consultation body and a further 15% said that they were considering introducing one.

Some 23% of firms said that skill shortages when recruiting had a significant or severe impact on their business performance. Employers are reported to have increased their commitment to training. The largest overall growth was in on-the-job, individualised and job-specific forms of training. The smallest firms were more than twice as likely to have increased training expenditure as the largest – 63% as opposed to 31%.

The survey also asked about the use of "workforce agreements" to gain flexibility on working time (UK9810154F) and parental leave (UK9912144F) issues in respect of employees not covered by collective bargaining. A quarter of employers said that they had introduced or were considering a workforce agreement on working time. One in 10 employers had already introduced a workforce agreement governing working time and 17% were considering such an agreement. Workforce agreements were much more prevalent among companies that bargain with trade unions. The CBI comments that this suggests that companies are looking to achieve the same flexibilities through workforce agreements as they have achieved elsewhere in the organisation through collective agreements with unions.

Some form of "family-friendly" policy was reported by over two-thirds of companies. Emergency time off for dependants beyond the statutory minimum was the most widely reported policy (44% of respondents), with maternity leave or pay in excess of the statutory minimum being offered by 40%. One in five companies said they had a parental leave policy that went beyond the statutory minimum. The vast majority of employers (86%) do not offer any paid parental leave.

Commenting on the survey findings, John Cridland, the CBI's deputy director-general, said: "Companies are increasingly aware of the need to improve staff skills, but red tape is distracting business from focusing on this and improving productivity. Firms are working hard to balance business and employee needs, but more legislation could tip the scales in the wrong direction."