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by: John Holmes
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Date: Thu, 20 May 2010 Time: 7:03 AM
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There may be signs that the economy may be emerging from recession but most experts agree that there are still uncertain times ahead with huge cuts in public services almost certain as the UK struggles to cut the massive budget deficit.

Uncertainties over the general election result, instability in the Eurozone and fears of a double-dip recession have all combined to make it increasingly difficult for businesses to plan for the future.

One thing is clear, however, businesses across all sectors and of all sizes need to concentrate on efficiency improvement if they are to survive the turbulent times ahead.

With the latest figures from the Office of National Statistics (ONS) showing that the economy grew by just 0.2% in the first quarter of 2010 – down 0.2% on the final three months of 2009 – UK business can’t afford to become complacent.

Whilst the focus has been on future cuts to the public sector, small businesses and multi-national companies will also need to become leaner as money becomes increasingly tight.

Many have already made significant steps towards greater business efficiency but difficult decision still lie ahead for both the public and private sector.

This pain will be felt in all sectors of the economy – banking group RBS recently announced it will be making a further 2,600 job cuts over the next year – and even those that aren’t planning redundancies will be reluctant to take on new staff until there are stronger signs of a sustained economic recovery.

A recent Report on Jobs published by the Recruitment and Employment Confederation (REC) and KPMG highlighted that although there had been increases in both permanent and temporary/contract staff appointments during April, the rate of growth had slowed down when compared with March.

Kevin Green, the REC's Chief Executive, said the report highlighted continued growth in both temporary and permanent employment, and the first test of the government will be to nurture the slowly improving but fragile jobs market.

He went on to say the incoming administration must address two immediate priorities – stimulating jobs growth and reducing expenditure without creating a public sector recession through shedding thousands of posts.

Private sector employers have used short-time work, sabbaticals and pay freezes as a means of reducing costs whilst retaining high-performing staff. He added that innovative HR resourcing strategies will be equally crucial within the public sector.

Meanwhile Bernard Brown, Partner and Head of Business Services at KPMG warned that it is becoming increasingly clear that the long predicted public sector recession has started to hit the jobs market and, as a result, the upwards trend seen over the last couple of months may come to a halt.

With such warnings, an increasing number of businesses are increasingly turning to productivity improvement consultants to improve business efficiency and boost their competitiveness.

By working with specialist productivity improvement consultants they can often achieve this without the need for further redundancies, making best use of a companies most valuable asset – their staff.

This approach has already proved successful in the manufacturing sector. Although manufacturing has suffered significantly over the past couple of years, in many cases the mass redundancies of previous recessions have been avoided due to more flexible working arrangements, pay freezes and using downtime to invest in training in the latest lean manufacturing techniques.

This has enabled many firms to match employee time and attendance to work that was available rather than just making redundancies and losing valuable skills that will be needed once sustained growth returns to the economy.

These lessons can be learned across other sectors such as finance, retail and services whilst another area that all businesses can look at improving business efficiency is through better recruitment processes.

As unemployment rises, there are more candidates applying for jobs and it is essential that employees find the right candidate. Appointing the wrong person can prove expensive in both the short and long-term.

Companies can employ a number of techniques to ensure they find a candidate that is the right fit for the role and the company – including psychometric tests and personality tests.

Such personality tests give employers a more rounded picture of the candidate than an interview alone and at the same time, when applied in the initial stages of the recruitment process, they can save time and money by removing unsuitable.

John Holmes has been involved, at senior levels, in the HR Services, career management, psychometric testing and business productivity industries for over 10 years.