Badenoch & Clark public sector cuts budgeting for the big society


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A Badenoch and Clark commissioned research piece into the effects of budget cuts and the impending impact of the 'Big Society' programme.

Management, morale, skill sets, public sector versus private sector are all topic covered in the document.

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Badenoch & Clark public sector cuts budgeting for the big society

  1. 1. Page 1 0f 9Public sector cuts:budgeting for theBig SocietyKey findings / April
  2. 2. Public sector cuts: budgeting for the Big Society / Key findings / April 2011 Page 2 0f 9Public sector cuts:budgeting for the Big SocietyKey findings Foreword Six months have passed since the Chancellor, George Osborne, career move, a growing number of the public sector – particularly unveiled measures to cut the UK’s budget deficit. Yet while the managers – believe they possess the skills necessary to excel in cuts outlined in the Comprehensive Spending Review were the private sector. communicated by the Government as positive for the UK economy, those most affected were less than content. The public sector The research we have conducted is demonstrative of an important is bearing the brunt of these cuts intended to redesign the UK’s cultural shift in the public sector. With morale at an all time economic map, with thousands to lose their jobs in a radical low, further cuts looming, and workers becoming increasingly shake up of UK public services. despondent, managers must reassess internal communication strategies and develop a greater sense of workplace efficiency. Six months on from the Comprehensive Spending Review, In essence, the public sector must now adopt the tone and culture the future is as uncertain as ever for public sector workers. of the private sector. Last October, we found half of public sector workers believed that the results of the Comprehensive Spending Review would For those who remain dissatisfied: a move to the other side of the have a detrimental effect on staff retention, with a fifth unsure professional fence beckons. And with pay cuts and salary freezes, what to expect from the coming six months. In the wake of last coupled with longer working hours, prevalent throughout the public week’s budget, an overwhelming three quarters of public sector sector, such a move is, perhaps, an increasingly seductive one. workers rate staff morale as average to poor. Half justifiably believe that the cuts are having a ‘devastating effect’ on the Our programme of ongoing research into the most contemporary UK’s public sector. And a further three quarters feel that the and critically engaging employment issues is a clear reflection government is not doing enough to get people back to work. of a commitment to our customers. We believe a clear and lucid comprehension of the issues faced by the public sector as a whole Our research highlights a number of flaws currently present is integral to our pledge to add demonstrable and measurable within the overstretched and under-resourced public sector. value to our customers entire business model. Lack of communication from senior management is resulting in low morale and mixed messaging; lack of clarity on key HR issues such as professional development is leading to despondency and, ultimately, could well lead to a talent drain. As the public sector experiences unprecedented change, an increasing number are reassessing their career options, considering employment in the relatively healthy private sector. Nicola Linkleter And while, six months ago, many felt unable to make such a large Managing Director, Badenoch &
  3. 3. Public sector cuts: budgeting for the Big Society / Key findings / April 2011 Page 3 0f 9Executive summaryPrior to George Osborne’s budget sector workers, who previously prospered The Big Society agenda, seen by many asannouncement’s of last week, Badenoch under New Labour, have emerged as the political justification for the cuts, appears to& Clark’s latest research highlights, true ‘squeezed middle’ of austerity Britain. be creating larger divisions between Londonoverwhelmingly, that that the key issue for Our research goes further, suggesting and the rest of the UK. While job cuts arepublic sector workers relates specifically that in spite of the Treasury’s promises of relatively low on the radar of London-basedto employment initiatives, designed to increased fiscal stimulus and job creation public sector workers, with less than two inget the recently-made redundant back to throughout the UK economy, public sector ten (17.4%) citing such concerns, a third ofwork. Over half (55.1%) suggested that such workers are experiencing exceptionally low workers in the North East (28.3%), Walesemployment issues top the policy agenda levels of workplace morale, which is having (32.6%) and Yorkshire (27.9%) see job cutsfor public sector workers. Furthermore, a direct impact on productivity and output as an inevitable part of the Spending astounding three quarters of workers at all levels.(75.9%) criticise the government for not Our research highlights that the publicdoing enough to get the UK back to work. Feedback from workers regarding the sector workplace is currently in a stateOur research reveals that cuts to the public impact of the Comprehensive Spending of crisis. With morale dropping fast andsector have come too quick and too fast, Review speaks for itself. A quarter (25.4%) staff increasingly lacking confidence inleaving the sector under resourced and in of workers stated that significant job losses employers, clear management of the publica state of internal turmoil. will be made in the next six months; a fifth sector workforce is absolutely necessary (21.9%) suggested that there was no impact to ensure the correct running of publicLast October, the forecast effects of the as yet, but that they were unsure what to services, and to develop the future of theComprehensive Spending Review included expect for the future. A further fifth (17.5%) sector. Failure to do so could well lead to athe headline-grabbing loss of 490,000 said there have been job losses and that drastic loss of talent to the private sector,public sector workers. The implications for departments are under resourced. Contrary further undermining public sector recovery.the sector are clear: unprecedented levels to promises from the Treasury in the run upof redundancy and almost absolute levels to the Budget, expectations regarding theof uncertainty about the future. Indeed, creation of new jobs have, it appears, nota recent report by the Financial Times been effectively managed, with only one insuggests that white-collar public ten (14%) public sector workers suggesting job creation would feature as part of the cuts. Do you think the Government could do more to help UK employment prospects? Yes, the cuts are having a devastating impact 48.6% Yes, they need to do more 48.2% No, I believe the cuts were/are necessary 12.1% No, there is nothing that can be done
  4. 4. Public sector cuts: budgeting for the Big Society / Key findings / April 2011 Page 4 0f 9Key findings by sectorCentral Government Local Government• 41.8% believe that significant job losses • 36.7% believe that significant job losses will be made in the next six months will be made in the next six months• 45.9% see coping with a lack of resources • 38.3% suggested that a ‘do without’ as the key challenge facing the sector attitude was propounded by managers over the next six months post the spending review• 66.3% believe that maintaining high staff • 43.8% would rate morale in their morale has been the greatest challenge department as poor faced over the last six months NHSCharities • 24.5% are unsure what the future holds• 51.5% said the biggest challenge was for the sector maintaining staff morale • 50.3% believe that they now work harder• 81.9% rated morale in their department in the wake of the spending review as average to poor • 50.2% believe that maintaining high staff• 54.5% believe that the cuts are having morale has been the greatest challenge a devastating effect on the sector faced over the last six monthsHousing• 39.1% said that the sector has suffered and was under resourced as a result of job cuts• 36.4% of workers believe that they now work harder post the spending review• 43.5% believe that maintaining high staff morale has been the greatest challenge faced over the last six
  5. 5. Public sector cuts: budgeting for the Big Society / Key findings / April 2011 Page 5 0f 9Morale: public sector, private concernsMorale in the public sector is lower than of all Scottish workers predicted that However, perhaps most importantly,ever before. Over three quarters (76.6%) significant job cuts would be made over almost nine out of ten (87.9%) HRof public sector workers said morale was the course of the next six months; a further professionals in the public sector saideither average or poor – with those in quarter (25%) of workers based in Scotland morale was either average or poor. Levelslocal and central government particularly were unsure what to expect in the next half of uncertainty remain high, with a thirdconcerned about what the future holds, and of the year. (33.3%) expecting sweeping job cuts in theira quarter (21.9% and 22.4% respectively) department and a further fifth (21.2%) statingciting an under resourced and over stretched Sector specific research further underlined they remain uncertain as to what the futureworkforce as an absolute hindrance to the key issues faced by the public sector. holds. Two fifths (42.3%) of HR respondentsinternal development. Morale amongst those A quarter (24.5%) of NHS staff suggested also claimed that they work much harder inworking in both local and central government that while there was no immediate impact the wake of the Comprehensive Spendingappears to have taken the biggest hit with of cuts upon the sector, staff are unsure Review. If public sector HR professionals84.4% and 86.7%, respectively, stating what the future holds. Well over a third are feeling the strain, then the possibility ofmorale was average to poor. (39%) of those working in the public housing assuaging the cuts through strong learning sector suggested that they had experienced and development initiatives is increasinglyLevels of uncertainty in the public sector job losses and that the sector was under uncertain. This issue must be addressedremain high, with over a quarter (25.4%) resourced as a result. Half (50.4%) of as a matter of utmost urgency – clearexpecting sweeping job cuts in their workers across the public sector felt that communication and appropriate trainingdepartment, and a further fifth (21.9%) maintaining morale had been one of the programmes are key here.stating they remain uncertain as to what critical challenges over the last six months;the future holds. Moreover, two fifths comparatively, two thirds (66.3%) of central It is clear that effective workplace(41.2%) of workers also claimed that government workers acknowledged morale management will be crucial over the comingthey work much harder in the wake of as a key issue for departments. months. Employees and employers acrossthe Comprehensive Spending Review. the public sector appear to recognise this: Low morale is not limited to any one when asked how issues with morale wereMorale appears to be particularly low in professional area. Indeed, 43.8% of IT being addressed in their department,the north of England, where public sector professionals believe that the cuts are having a third (34.3%) indicated that effectiveworkers have been amongst the hardest hit a devastating effect on the public sector; internal communication was key toby the Comprehensive Spending Review: a further two thirds (66.7%) of those in maintaining strong staff morale. This was77.3% of workers in the north east rated procurement would argue the same. Nearly followed by training and developmentmorale average to poor. Similarly, three three quarters (70.6%) of accounting and opportunities at 18.7% and team buildingquarters (75.0%) of Northern Irish public finance professionals would rate workplace exercises at 17.9%.sector workers suggested that maintaining morale as average to poor, and 46.5% ofstaff morale was the biggest challenge faced project managers believe that they now workover the last six months. A quarter (22.2%) harder as a direct result of the spending cuts. How would you rate morale in your department? Average 39.1% Poor 37.5% Good 20.8% Excellent
  6. 6. Public sector cuts: budgeting for the Big Society / Key findings / April 2011 Page 6 0f 9Management: leadershipin the age of austerityOur research has demonstrated a gap It is clear that a lack of communication the lack of vibrancy in the public sectorbetween the managerial perception of between managers and staff is hindering at large. Key for public sector leaders willthe effect of cuts on the public sector, strong leadership in the public sector. be the careful management of workplaceand the actual realities experienced by Indeed, a mere third (33.7%) of workers said morale. Employers must act effectively topublic sector employees. that leaders were effectively communicating repair strained relationships with their in the wake of job cuts. This is demonstrated employees. Honesty, transparency andAs suggested above, two fifths (41.2%) most clearly by the fact that while two fifths clear management of expectations will beagreed that they now work harder as a (41.2%) of employers and senior decision vital as the effects of the austerity budgetresult of the Comprehensive Spending makers believed they were offering clear begin to hit public sector workers both atReview, with a further third (33.5%) noting training and learning and development work and home.that a ‘do without’ attitude was adopted. opportunities to staff, only half that amountNonetheless, there is a clear and stark of employees (17.7%) were aware of suchcontrast in opinion between workers and initiatives. Furthermore, while nearlymanagers on the subject of workplace half (47.2%) employers saw team buildingeffectiveness. While nearly half (43.8%) as a central part of morale managementof employers and senior decision makers and motivation during cuts, less than ain the public sector believe that their fifth (15.1%) of workers suggested thisworkforce now works more effectively was the a result of the cuts, less than a fifth(14.4%) of employees are of the same Ineffective communication is inhibitingopinion. Moreover, while a quarter the development of morale within the(25.5%) of senior directors or employers public sector. In the age of crisis and cuts,felt justified in stating that there has not staff must be certain of clear directionbeen an impact on workforce, only 7.3% from the top. The apparently disparateof line managers felt the same way. relations described by workers highlights How is your department managing morale/motivation in the wake of job cuts in the sector? Employee Employer and senior decision maker Effective communication 33.7% 47.1% Not doing much / anything at all 28.4% 11.8% Training/L&D 17.7% 41.2% Team building 15.1% 47.2% Increased flexible working hours 12.8% 47.1% Career planning 8.7% 17.6% Recognition programmes 5.9% 5.9% Unpaid leave 5.3% 11.8% Paid leave 4.2%
  7. 7. Public sector cuts: budgeting for the Big Society / Key findings / April 2011 Page 7 0f 9Re-evaluating skill sets:the public/private divideWhile the impact of the cuts has clearly However, only one in ten (13.7%) public sector workers have been traditionally seenbeen felt by public sector workers, a degree sector employees said they would need to as unable to cope with the increased timeof loyalty to the sector remains. However, upskill or retrain significantly in order to pressures of private sector working life,only two fifths (40.5%) of public sector transfer to the private sector, and a mere the development of new skill sets may wellemployees are absolutely certain that 5.9% of managers felt similarly. But perhaps be representative of a cultural shift in thethey would like to stay in the public sector most pertinent is the fact that over a third public sector at large. As such, the futurefor life; only a third (35.3%) of managers (35.3%) of managers said that if they were need not be gloomy in an absolute sensewould like to do the same. The lure of the to move to the private sector, they would for public sector workers and managers.private sector appears to be strengthening, not need to upskill or retain at all. This Rather, workers must now see the cutsparticularly as the public sector comes is particularly marked in London, where as a possibility for the development ofunder increasing amounts of public managers appear to be most confident crucial time and people management skills,scrutiny. This is especially the case for about a move to the private sector: coupled with a nuanced understanding ofpublic sector managers, who are faced with a third (33.7%) believe they would not the vital importance of clear communicationa choice between being broadly criticised by have to retrain at all. Meanwhile, over three in times of crisis.government spokespeople in the media for quarters (79.1%) of workers in Scotland areinefficiency and bureaucracy, whilst being not considering a job move at present; and,paid vastly less than their private sector curiously, half (50.0%) of all public sectorcounterparts in equivalent roles. workers in Northern Ireland would not want to move to the private sector, despiteThat said, a large percentage of workers 68.8% believing that the cuts are havingsuggested that, at least for the time being, devastating effects on the public sector.they are not currently searching for a newjob. Two fifths (41.9%) of NHS workers said It appears that the process of cuts andthat they will wait further developments the re-evaluation of workplace priorities,before making any career change decisions, which the public sector has undergone overand half of local and central government the last six months, has resulted in thestaff (51.2%, 51.0%, respectively) said the development of a specific set of importantsame. Moreover, a move to the private crisis management skills. Such skills leavesector was ruled out by a third (30.3%) of workers and managers adept at copingthose working in charities and those based with a dynamic, stretched and fast pacedin Scotland (34.7%). working environment. And while public Which of the following statements applies to you if you were considering moving to the private sector? I would not want to move to the private sector 32.3% I feel I would need to upskill/retrain slightly 27.2% I feel I would need to upskill/retrain slightly 27.0% I feel I would need to upskill/retrain significantly
  8. 8. Public sector cuts: budgeting for the Big Society / Key findings / April 2011 Page 8 0f 9Concluding thoughtsCuts to the public sector were perhaps In our last report, ‘Public sector cuts:inevitable. Public sector workers were workplace worries’, on the state of theamongst the most vocal critics of the public sector, we suggested that internalsector, with bureaucracy and inefficiency development will necessarily lead tosynonymous with local government external gain – reaffirming the publicinitiatives and NHS waiting lists. sector brand, retaining and attracting theNonetheless, the political realities of very best talent. This remains true – and inthe age of austerity have hit workers hard spite of the cuts, managers must underline– at home and at work. Maintaining morale the possibility for the development ofhas been nigh on impossible, given the important leadership and communicationvast number of redundancies faced across a skills. As suggested above, recent crisesrange of public sector departments. And the have provided workers with stronger timelack of confidence in the future of the sector management skills and the abilityhas been detrimental to relations between to work in a highly pressured environment.workers and managers. The potentially negative impact of these conditions must be reversed into aIn times of crisis, communication is genuinely positive outcome: placing thekey. Public sector managers must learn public sector at the vanguard of the UK’sfrom the lessons of the last six months, road to recovery, and working through theand implement a coherent internal cuts to stimulate economic growth andcommunications campaign to reignite social good at all in workers. The cuts could well beseen as a genuinely positive opportunity to A change in perspective will lead to a changereassess internal direction and to reposition in morale. The public sector must nowthe public sector as an employer of choice. refocus its efforts on a positive process ofPublic sector workers are not necessarily change – the ultimate outcome of which willkeen to leave the sector for good – what only, by definition, result in a reinvigoratedthey need instead is a focus on learning and dynamic public sector workforce.and development, and a chance to achievethe same levels of expertise as their privatesector counterparts. A reevaluation of theHR function in the public sector is critical.Our research has shown that many publicsector HR professionals are drasticallyunder resourced, and, as such, are unableto instigate important initiatives toreinvigorate the sector as a whole.Public sector managers must addressthis issue as a matter of urgency if culturalchange is to become a
  9. 9. Public sector cuts: budgeting for the Big Society / Key findings / April 2011 Page 9 0f 9Details and methodology Other Badenoch & Clark resources Public sector cuts: workplace worriesThe research was conducted by an public sector professionals were surveyed Read the key findings from our opinion researchindependent research company between 28 across Central Government, Charities, undertaken prior to the Comprehensive SpendingFebruary 2011 and 08 March 2011. 1009 UK Housing, Local Government and the NHS. Review in October 2010. Nationwide career clinics Our career clinics provided solutions on how toAbout Badenoch & Clark cope with the anticipated redundancy programme as part of the Comprehensive Spending Review. They helped public sector professionals prepareWhether you’re looking for a fresh Specialists in public sector recruitment, for the jobs market by providing expert advicecareer opportunity or to recruit talented we work with a variety of organisations on CV writing; interview techniques; personal branding and career plans. Download the toolsprofessionals, you’ll want to work with a ranging from the NHS and housing discussed and ensure you are ready to take yourrecruitment partner who really understands associations to central and local career forward.your needs. A partner who listens and you government. Increasingly recognised as insight.badenochandclark.comcan trust to deliver. a leading player, the company is often seen Market commentary, news and analysis for as the go-to commentator on recruitment customers and contacts of Badenoch & Clark.You’ll discover that at Badenoch & Clark issues in the marketplace. Insight is here to help you make informed career and talent management decisions, by keepingwe invest in getting to know what’s really you on the cutting edge of developments in yourimportant to you. You’ll have access to our Which means that when it comes to building profession and a thought leader in your field.know-how and expertise. And you’ll find your team or finding your next career move, Connectionsthat we work hard to help you make the right there can be only one choice of public sector Our unique magazine for customers and contactsconnections. All delivered in a refreshingly recruitment partner. of Badenoch & Clark, published three times ofhonest and open way. year. Packed with comment, opinion, news and analysis on recruitment, talent management and broader business issues.Contact us Career guides A series of ‘how-to’ guides for employers and employees focusing on topics including employerFor more information on our research please contact Elvira Tynan at branding, career planning and work-life A quarterly index tracking employee happiness across the UK office workforce. Results by profession and region.© 2011 Badenoch & Clark. All rights reserved. Badenoch & Clark accepts no liability for the accuracy of the contents or the opinions expressed herein.Recruitment specialists for: Accounting & Finance, Banking & Financial Services,Human Resources, IT, Legal, Marketing & Communications, Procurement & Supply Chain,Project & Programme Management, Public