Government hopes that private sector job creation would offset job losses in the public sector will fail to be realised next year as unemployment continues to rise, according to the Chartered Institute for Personnel and Development.
The human resources industry body also says that with a “relatively benign” outcome to the sovereign debt crisis and the current wrangling over the future state of Europe, job losses should be down on those seen at the height of the crisis in 2008.
It says it expects unemployment to rise next year and peak at 2.85m in 2013. Unemployment currently stands at 2.64m.
CIPD chief economic adviser John Philpott says: “As long as there is a relatively benign outcome to the eurozone crisis, we expect the 2012 jobs recession to be milder than that suffered in 2008/09.”
The Government has said it expects the private sector to create more jobs than posts lost in the public sector as a result of its cuts to public spending. The CIPD says while it does not expect widespread private sector redundancies there will not be enough new positions to make up for the 120,000 public sector job losses expected next year.
A Department for Work and Pensions spokeswoman says: “There has obviously been an unwelcome increase in unemployment since the summer but the latest unemployment figures show some signs the labour market is stabilising. The number of people in employment is higher than last month, and the number of unemployed people is steadying.”