In a survey of 701 UK managers – conducted by the Chartered Management Institute (CMI) between 15 March and 10 April 2012 – 83 per cent said that the state of the economy is having a negative impact on their organisation. This number has held steadily above 80 per cent since March 2009.
The biannual economic outlook report revealed the concerns held by the UK’s managers and leaders about the current economic situation. It also outlined senior executives’ views on the state of the economy in 12 months and beyond.
Some 57 per cent of managers report pay freezes in the last six months, with 50 per cent attempting to reduce business overheads and 49 per cent seeing a recruitment freeze in their organisation. Nearly two thirds of managers (64 per cent) say that staff morale has got worse in the last six months.
On the other hand, The survey found that the number of managers expecting growth to accelerate has more than doubled from 8 per cent six months ago to 17 per cent. In addition, the number of managers feeling insecure in their jobs has fallen from 48 per cent six months ago to 43 per cent now, and the number who believe that business insolvencies will increase has fallen from 76 per cent to 71 per cent.
The survey also found that managers in the public sector feel most affected by the current economic conditions, are the least optimistic about the future, are the most insecure about their jobs, and have the lowest morale.
Christopher Kinsella, acting chief executive of CMI, said:
Although it is good to see improvement in the longer term outlook amongst UK managers particularly in the private sector, as last week’s GDP figures show, we are still experiencing tough times. With morale continuing to be low and managers having to deal with difficult issues such as pay freezes and job insecurity, the journey back to economic prosperity is likely to feel like a long slog for many people.
It is particularly worrying to see the number of people who continue to expect to see cuts in budget for training, and management and leadership development. With recent CMI/Penna research showing that effective management development can improve organisational performance by as much as 23 per cent, this type of short-termism risks damaging our ability as a nation to grow once more. Both government and employers have a role to play in addressing this issue, and we call on both to work now to ensure management skills shortages do not hamper our chances of recovery.
