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TV Dragon Hit As Recruiters Fined £40m

A recruitment agency owned by Dragons’ Den star James Caan has been fined by regulators over a price-fixing scandal.

Eden Brown, which is owned by Caan’s HB Human Capital investment fund, is one of six companies hit with Office of Fair Trading penalties totalling £39m.

The companies were also accused of a collective boycott of another company in the supply of candidates to the construction industry.

The actions for which the firms were penalised took place prior to HB Human Capital’s acquisition of Eden Brown in 2007.

FTSE 250 firm Hays was fined £30m but said it was considering an appeal on the basis the penalty was “wholly disproportionate to the activities to which it relates”.

The OFT concluded that the companies all breached the Competition Act 1998 in their treatment of rival agency Parc.

In 2003, Parc entered the market to act as an intermediary between construction companies and different recruitment agencies. Some recruitment agencies saw Parc as a threat to their margins.

Instead of competing with Parc – and each other – on price and quality, the companies formed a cartel, referred to as ‘the Construction Recruitment Forum’, which met five times between 2004 and 2006.

In this forum, they agreed to boycott Parc, and also co-operated to fix the fee rates they would charge to intermediaries, such as Parc, and also certain construction companies.

Heather Clayton, OFT senior director, said: “This is a serious breach of competition law and the level of fines reflects this.

“Cartels such as these can impact on other businesses, in this case construction companies, by distorting competition and therefore preventing firms from driving down costs.

“Ultimately it is the consumer and the wider economy that loses out.”

Courtesy of SKY NEWS

Career advice for seven-year-olds

Children as young as seven are to be offered careers guidance under a government scheme in England.

The programme, which aims to broaden the horizons and raise the aspirations of children from deprived backgrounds, is to be piloted in seven local areas.

Universities and firms will give pupils a glimpse of what it is like working and learning in adulthood, as part of a broader new careers strategy.

Under the scheme, careers advice will continue up to the age of 18.

It is being trialled in 38 primary schools in seven local authority areas: Bristol, Coventry, Gateshead, Manchester, Plymouth, Reading and York.

The pilot comes after education charity the Sutton Trust called for universities to do outreach work with primary pupils.

‘High aspirations’

The programme aims to challenge some of the “negative stereotyping” that leads some children from poorer backgrounds to believe that universities and certain careers are out of reach for them.

Children will be offered career-related learning in a range of areas to raise awareness of what they can achieve.

It is hoped this will lay the foundations for them to make good subject choices in secondary schools and inspire them to do well.

As part of the new careers strategy, parents will be urged to think while their children are still in primary school about what jobs they might want to do.

Online advice

New research suggests that many children have very high aspirations at age 11, with 75% saying they want to go to university.

The Department for Children, Schools and Families wants teachers and parents to build on this to get children thinking about higher education, especially those from homes where no members of their family have been to university before.

The department stresses the scheme is not about helping children decide what job they want to do, but showing them what can be possible so they fulfil their potential.

There will also be more help for disadvantaged and disabled young people in accessing work experience and every young person is to get a careers mentor.

Children are also to be offered good information, advice and guidance online on Facebook, YouTube and other social networking sites.

Courtesy of BBC News

Record recession for UK economy

The UK economy unexpectedly contracted by 0.4% between July and September, according to official figures, meaning the country is still in recession.

It is the first time UK gross domestic product (GDP) has contracted for six consecutive quarters, since quarterly figures were first recorded in 1955.

But the figures could still be revised up or down at a later date, because this figure is only the first estimate.

GDP measures the total amount of goods and services produced by a country.

Quarterly growth of 0.2% had been expected in the figures from the Office for National Statistics (ONS), although expectations had been tempered by recent figures showing no growth in retail sales in September, and a 2.5% decline in industrial output in August.

The unexpected decline in the services sector was the key factor behind the drop, with the distribution, catering and hotels sector performing particularly badly.

The UK economy’s reliance on the service sector, and financial services in particular, may be the reason why it is still in recession when partners such as France and Germany exited earlier in the year.

The economy contracted 5.2% compared with the same period last year, which was marginally better than the record figure of 5.5% in the previous three months.

It has now contracted 5.9% from its peak before the recession began.

The worse-than-expected GDP figures are likely to make the Bank of England consider extending its policy of quantitative easing.

Quantitative easing is the central bank’s policy of printing money and using it to buy bonds from banks and other companies to help stimulate the economy.

“Back in August we had a worse-than-expected second-quarter GDP number and that is the reason that the Bank of England extended the quantitative easing programme,” Bronwyn Curtis from HSBC told the BBC.

The UK economy unexpectedly contracted by 0.4% between July and September, according to official figures, meaning the country is still in recession.

It is the first time UK gross domestic product (GDP) has contracted for six consecutive quarters, since quarterly figures were first recorded in 1955.

But the figures could still be revised up or down at a later date, because this figure is only the first estimate.

GDP measures the total amount of goods and services produced by a country.

Quarterly growth of 0.2% had been expected in the figures from the Office for National Statistics (ONS), although expectations had been tempered by recent figures showing no growth in retail sales in September, and a 2.5% decline in industrial output in August.

There’s no disguising how grim these figures are. Almost every City analyst expected there to be positive growth in the third quarter. Instead it was negative.

That means the recession in the UK is the longest since modern records began in the 1950s.

Germany, France and Japan have all come out of recession technically and the UK hasn’t. The decline has continued.

And the markets didn’t really like the look of that. The foreign exchange markets have been selling the pound.

The unexpected decline in the services sector was the key factor behind the drop, with the distribution, catering and hotels sector performing particularly badly.

The UK economy’s reliance on the service sector, and financial services in particular, may be the reason why it is still in recession when partners such as France and Germany exited earlier in the year.

The economy contracted 5.2% compared with the same period last year, which was marginally better than the record figure of 5.5% in the previous three months.

It has now contracted 5.9% from its peak before the recession began.

The worse-than-expected GDP figures are likely to make the Bank of England consider extending its policy of quantitative easing.

Quantitative easing is the central bank’s policy of printing money and using it to buy bonds from banks and other companies to help stimulate the economy.

“Back in August we had a worse-than-expected second-quarter GDP number and that is the reason that the Bank of England extended the quantitative easing programme,” Bronwyn Curtis from HSBC told the BBC.

Graph showing GDP growth

‘Awful’

The £175bn already announced for the quantitative easing programme will have been spent by next month, so the strength of the third quarter GDP number will be important in deciding whether to extend it.

Indeed, at the Bank’s current rate of spending, it is expected to have spent the whole £175bn in the next week.

As the next Monetary Policy Committee meeting, at which quantitative easing decisions are taken, is not until 4 November, that would leave it with a week with no extra cash to pump into the economy.

The figures were “awful with no positive news” according to James Knightley at ING.

“This clearly suggests that the likelihood of an expansion in quantitative easing by £50bn or so over the next quarter is rising, although [it] is not a foregone conclusion.”

‘Help for business’

The pound fell more than a cent against the US dollar following the release of the figures, with traders particularly concerned that the UK may turn out to be the only major economy still in recession.

It is also worrying that the decline has continued despite the stimulus measures that the government and the Bank of England have introduced.

“Continued intervention – including help for businesses to access finance, and incentives to promote investment – is still needed,” said David Kern, chief economist at the British Chambers of Commerce.

“Above all else, business confidence must be nurtured, to ensure that recovery is not further delayed.”

‘Deeply disappointing’

Chancellor Alistair Darling said he had never expected to see growth before the end of 2009.

“Our job is to support the economy as we come through towards recovery,” he said.

“[Growth] will come – I’m confident about that – and I’m confident that businesses and people generally will begin to see a difference, but it will take time.”

Shadow chancellor George Osborne described the figures as “deeply, deeply disappointing”.

There are many millions of people who will be deeply concerned to see that Britain is still in recession six months after France and Germany came out of recession,” he told the BBC.

“It destroys the myth that Britain was better prepared.”

Liberal Democrat Treasury spokesman Vince Cable said the figures were “a cold blast of realism”.

“We’ve had a lot of talk recently based on a booming stock exchange and prices of luxury houses in London that somehow this problem was at an end, and it isn’t,” he said.

One of the measures expected to be a particular help in the final quarter of the year is the change in VAT.

The rate of VAT is due to return to 17.5% from 15% at the beginning of January and consumers are expected to step up their purchasing ahead of that increase.

Courtesy of BBC NEWS

Growth in UK unemployment slows

The latest official UK unemployment figure has risen once again, but the rate of increase has slowed.

Unemployment increased 88,000 to 2.47 million in the three months to August, from the three months to May. The jobless rate rose to 7.9% from 7.6%.

The rise in the number of unemployed was the lowest since July 2008, said the Office for National Statistics.

The number of people claiming unemployment benefit grew in September by 20,800 to 1.63 million.

While the number of people claiming the benefit is now the highest since 1997, the rise compared with the previous month was the least since May 2008.

The number of young unemployed people – those aged between 16 and 24 – continued to rise, totalling 946,000 in the three months to August. This compares with 927,000 for the three months to July.

‘Fragile recovery’

“Although unemployment isn’t as high today as many feared it would be at the time of the Budget, it remains a serious problem, which is why we must keep increasing support and advice to get people back into jobs,” said Work and Pensions Secretary Yvette Cooper.

Paul Kenny, general secretary of the GMB union said the latest figures showed “some tentative signs of a very fragile recovery in the economy”.

Investec chief economist Philip Shaw said the numbers were “more encouraging than we had hoped”.

“It does suggest that the pace of deterioration in the jobs market is easing quite sharply which is encouraging for the outlook for a sustainable recovery,” he said.

The latest unemployment data comes a week before the Office for National Statistics (ONS) releases its first estimate for how the UK economy performed between July and September.

Despite some signs of economic improvement, analysts remain unsure as to whether the economy will post growth and therefore exit recession.

If the economy contracts again, it will be the first time that the UK has endured six successive quarters without economic expansion.

Low vacancies

The ONS data also showed that men remain the most affected by unemployment, with the number of males without work rising by 76,000 to 1.53 million in the three months to August.

The number of women unemployed totalled 935,000, up 12,000.

At the same time, the number of job vacancies in September fell to 422,000, the lowest since records began in 2001.

Meanwhile, average earnings excluding bonuses rose by just 1.9% in the three months to August from a year earlier, also the lowest figure on record.

Courtesy of BBC NEWS

Almost 40% of employers will increase business support head count

Over half of employers will keep their permanent hiring of business support professionals at the same level and 39% will increase headcount during 2009. That’s according to the 2009 market report and salary survey just released by secretarial and business support recruiter Crone Corkill.

Aditionally, while general market data is predicting a downturn in temporary hiring overall, the report says that evolving legislative changes around flexible working practices will continue to impact on hiring demand. “Maternity leave, for example, is often a big driver of temporary demand,” says Tracy Durrant, Managing Director of Crone Corkill. “And with maternity and paternity leave rights becoming more generous, we would expect this to be a continuing trend throughout 2009.”

Other key findings from the report which surveyed employers across the commerce, industry, financial services and not for profit sectors included:

- Languages in high demand as organisations become more internationally focused
- An emerging trend towards the Team PA driven by challenging market conditions
- A trend towards longer term temporary contracts
- Legal Secretaries now much more involved in client facing duties such as events and marketing
- Over 20% of employers reported a shortage of receptionists and top level Executive Assistants
- 15% of employers said that they had plans to increase recruitment from overseas during 2009

The full report can be downloaded at http://www.cronecorkill.co.uk/pdf/cc_salary_survey.pdf

Courtesy of recruitmenttimes.co.uk