Job woes rising as firms cut ties

Steve Pye (Blackpool, Fylde and Wyre branch chairman-Federation of Small Businesses). Story on pensions.
Steve Pye (Blackpool, Fylde and Wyre branch chairman-Federation of Small Businesses). Story on pensions.
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BUSINESSES on the Fylde coast are almost three times more likely to encourage voluntary redundancies during the next 12 months compared to two years ago, a report has confirmed.

Law firm Irwin Mitchell studied employee restructuring techniques and researched senior business decision-makers across the region to find a 54 per cent increase in the number of firms planning to outsource loss-making services.

Out of those businesses stating they were under immediate pressure to reduce their employee cost base over the next 12 months, 55 per cent said they would introduce a voluntary redundancy programme.

This compares to 20 per cent of companies who did the same during the last two years.

Steve Pye, chairman of the Federation of Small Businesses (FSB) on the Fylde coast, says the figures are worrying.

He said: “Voluntary or mandatory redundancies are always worrying and I think it’s down to the number of public sector jobs we have here.

“I’ve been going to businesses recently and they have been telling me nobody has come into the shop in six weeks and many are closing down.”

Ed Cotton, an employment Partner at Irwin Mitchell, added: “Businesses have been using more inventive solutions than redundancy when tackling staff costs but more now seem to be focused on some form of redundancy programme.

“Perhaps this indicates that alternative solutions have been exhausted.

“Nevertheless, there are signs of more inventive thinking.

“Many alternatives can involve changes to employment contracts but well planned and executed change programmes can succeed.”