Plea over job losses

Jul 6 2009 by Karen McLauchlan, Evening Gazette

BUSINESS leaders today urged the Government to do more to help stem the tide of job losses, including a scheme aimed at providing an alternative to redundancy.

The CBI warned that unemployment will rise to 3.03 million by next summer unless action was taken now to save jobs and businesses.

The group complained that levels of employment regulation had reached a “tipping point”, having added £70bn to business costs since 1998, shortly after Labour came to power.

An “alternative to redundancy” scheme should be adopted by the Government, under which workers would be paid an allowance twice the rate of Jobseekers Allowance, for six months if they were laid off, financed jointly by the Government and employers, said the CBI.

Ministers were also urged to review the current 90-day consultation where 100 or more employees face redundancy because it “prolonged uncertainty” for staff.

The CBI report, published with engineering firm Siemens, voiced concern about the increase in unemployment among young people, especially 16- to 18-year-olds not in education, employment or training.

Liz Mayes, assistant regional director, CBI North East, said: “Companies in the region have worked hard to maintain employment throughout the current downturn in a variety of innovative ways.

“As businesses in the North-east have grown over the last few decades they have built up a highly skilled talent base, and with skills shortages being an issue prior to the recession companies have been reluctant to let good people go.

“This report sets out some recommendations to government about what else needs to be done to help support businesses and employment through the downturn.”