Understanding the economy and labour market
This factsheet was last updated in August 2015.
Why understanding the economy matters for HR
Economic conditions provide the background to the everyday business of HR. What happens in the macro economy, or in individual product and labour markets, ultimately determines how many staff organisations need to recruit, retain and develop in order to meet customer demand.
That’s why it’s important for organisations and HR practitioners to monitor the state of the labour market and keep an eye on likely developments in the economy. Official statistics - mostly published by the Office for National Statistics (ONS) - or evidence drawn from independent surveys can help with this. Most of the official statistics are backwards-looking and indicate how the economy has been doing. Independent surveys, such as those by the Confederation of British Industry, the British Chambers of Commerce and the CIPD can provide intelligence on future market conditions. For example, our quarterly Labour Market Outlook survey collects data on pay and employment expectations from around 1,000 organisations in the private, public and voluntary sectors.
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- Why understanding the economy matters for HR
- Measuring the economy
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