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News Article - 23 May 2012
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Chancellor George Osborne recently announced 490,000 public sector jobs would be lost over the next four years as part of Government measures designed to reign in spending and reduce the deficit. 'Natural turnover' will be used to cut numbers where possible, but the chancellor warned that redundancies will likely be unavoidable.

The news will come as a blow to public sector organisations who reported feeling anxious over job cuts in the weeks before the spending review. According to a study published by law firm Eversheds in mid-October, nine out of 10 public-sector employers believe staff reductions will be the biggest problem facing their organisation over the next 12 months.

Now that the staff cuts are a reality, public sector organisations will no doubt be scrutinising current recruitment and employment practices closely, looking for ways to deal with job losses over the next 12 months in a financially healthy way.

Industry experts believe the spending cuts signify a major shift in direction for the public sector, and will come down to more than just reorganising employment practices to better handle the marketplace. The most significant part of the change will be localising power, for example by giving schools more power to control appointments. According to Jayne Carrington, managing director of Right Management, organisations that embrace the shift and manage it successfully will thrive in the public sector sphere.

Private-sector companies are also likely to be hit hard by the Government's austerity measures, in addition to the upcoming VAT rise. A recent report reveals private-sector firms could lose up to 500,000 employees in the medium-term, forcing a raft of pay freezes and other cost-cutting measures that have become commonplace in the public sector.

Implementing these will require HR professionals to pay close attention to forthcoming proposals to ensure redundancy exercises, contractual changes and other key issues are handled in a legally compliant way. Employers risk tribunal claims - which may rise due to resentment amongst ex-employees - and damage to reputation and profitability if they cannot successfully handle these issues.

With time being at such a premium, the considerable internal resources needed to complete these tasks may not be available. Access HR software can help free up valuable time by automating many of the most common business tasks, allowing HR managers to focus on any changes necessary to survive significant employment cuts over the next 12 months.

For more information, please call Access on 0845 345 3300.

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