Employment Trends - 3rd Quarter 2000 1. Employment in the Third Quarter of 2000 Looking back at the results of the second quarter survey, there was then stronger sentiment regarding the outlook for employment in the third quarter than there was for the expected trend in output. It has been shown above that the trend in output was ahead of expectations, particularly amongst specialist contractors. Where employment is concerned, by comparison, the balance of replies from specialists regarding the change in employment in the third quarter, +29, is a long way ahead of expectations, but that for builders, +17, falls short, and drags down the overall balance to +19, compared with that of +27 for the change in workload.
Table 7 - Change in Employment in the Last Quarter   1999 2000 Third Quarter 2000   wtd % balance wtd % balance Weighted percentage   Q3 Q4 Q1 Q2 Higher Same Lower Balance Northern 12 69 19 -7 Yorkshire & Humberside 52 46 2 +50 East Midlands 53 47 0 +53 East Anglia 9 82 9 0 London 27 65 8 +19 South East 29 52 19 +10 South West 39 47 14 +25 West Midlands 32 33 35 -3 North West 11 89 0 +11 Wales 22 78 0 +22 All builders +4 +20 -1 +13 32 53 15 +17 All specialists -23 -24 0 -11 43 43 14 +29 National -2 +12 0 +8 34 51 15 +19
The latest employment result differs from that for workload principally because the proportion of builders reporting increased employment, just under a third, is well short of that indicating a rise in workload. By comparison, the difference from the balance of expectations expressed three months earlier is due mainly to more builders reporting a fall in jobs than had expected to do so (15% against an expected 5%). Given the relative sizes of the samples of builders and specialists, roughly four to one, this exerts more influence on the overall result than the better-than-expected result for employment from the specialists. There are some much wider differences between the results for change in workload and change in employment by region, as set out in Tables 1 and 7. For example, respondents in the North produced one of the strongest results for workload, with 44% saying that their workload had increased and only 4% notifying a reduction, but show the poorest result for jobs, with just 12% saying that employment had risen compared with 19% indicating a reduction. By comparison, Wales showed the worst result for workload, but has a positive balance for the change in employment. Wales is one of three regions where no firm reports a drop in employment, another being the East Midlands from where the proportion reporting a rise in jobs is the highest of any region, and 12 points ahead of that indicating an increase in workload. As with earlier questions, the result for the South East hides a variety of experience in different segments, with the growth in employment concentrated in Kent, Surrey and Sussex, whilst firms operating mainly in Bedfordshire, Essex and Hertfordshire report a fall, despite having a positive balance for workload. 2. Expected Employment in the Fourth Quarter of 2000 Looking ahead, on the basis of weighted percentage balances of replies, firms taking part in the third quarter survey, more particularly the builders, would appear to be anticipating a stronger trend in employment than in workload, but closer examination suggests that the results from the two questions are broadly in line. Just over one in five firms, both builders and specialists, expect to be taking on more labour, which is a little less than the proportion looking forward to an increase in workload. The fact that the balance is stronger is because the proportion expecting to sheds jobs is only 8%, compared with 24% anticipating a drop in activity; but these figures are clearly compatible when one recognises that the firms that take part in the FMB survey include a significant proportion of small firms the workload of which would need to change quite substantially for them to employ more or less people.
Table 8 - Expected Change in Employment in the Next Quarter   1999 2000 Third Quarter 2000   wtd % balance wtd % balance Weighted percentage   Q3 Q4 Q1 Q2 Higher Same Lower Balance Northern 15 85 0 +15 Yorkshire & Humberside 18 71 11 +7 East Midlands 36 52 12 +24 East Anglia 16 79 5 +11 London 19 77 4 +15 South East 18 76 6 +12 South West 16 71 13 +3 West Midlands 25 66 9 +16 North West 42 53 5 +37 Wales 11 72 17 -6 All builders +12 +2 +23 +28 21 70 9 +12 All specialists +12 -4 +22 +13 21 74 5 +16 National +13 0 +23 +25 21 71 8 +13
Looking at the pattern of expectations by region, only in Wales is the proportion looking forward to a fall in employment significantly ahead of the national average, or that anticipating fewer jobs significantly below it. The two regions with the strongest expectations of more jobs are the East Midlands and North West, both of which also show up strongly in the regional analysis of workload expectations for the final quarter of the year. First posted: 25 October 2000. Last modified: 25 October 2000.