Contractors who work in the motor industry in the North East of England will be pleased to learn that their prospects are looking good!

Japanese car manufacturer Nissan has a large car assembly plant in Sunderland and last month it announced the creation of 1,000 additional job opportunities. Nissan intends to build 4 new models at the factory in the next two years.

Nissan’s plans have already had a positive impact on the supply chain and now Calsonic Kansel, which manufactures parts for Nissan, is planning to hire another 145 people at its Sunderland plant. Calsonic Kansel intends to invest as much as £15.3 million in the Sunderland site in order to expand its product offerings.

David Cameron was delighted to hear the news saying it showed the Japanese have confidence in British manufacturing and the commitment, flexibility and skills of the local workers.

Sunderland is getting a good name for itself in the global automotive sector. Nissan first set up there in 1986. By 2007, 400,000 vehicles were rolling off the production line every year.

Councillor Paul Watson also welcomed the Calsonic Kansel announcement, saying it was yet more good news for jobseekers in the City following recent expansion plans by SNOP, Vantec and of course Nissan.

The North East of England has not enjoyed the best of fortunes since the Tyne and Wear shipbuilding yards closed. Hopefully the area is now set to boom as a centre of excellence for the manufacture of automobiles.

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Umbrella company contractors north of the border will be pleased to learn that demand for their services continues to rise. The latest PMI shows that growth reached its highest level for four years in February and plenty of job opportunities are springing up for job seekers.

This welcome news came from the Bank of Scotland, which said the country is continuing to see “bountiful work” opportunities. The service sector demonstrated strong growth with its PMI increasing from 51.4 in January to 51.7 last month. That’s the 14th consecutive month when the PMI has increased, and that indicates positive times ahead.

Donald MacRae, the chief economist at the Bank of Scotland, said it was encouraging to see that the private sector still maintained a positive track after the financial meltdown. Both manufacturing and services registered increased output last month and increased recruitment in the service sector ensured the number of people in work grew at the fastest rate for four years. The latest results confirm that there is less likelihood of a double dip recession and Scotland should be able to look forward to a stronger recovery this year, he added.

After last week’s dismal employment statistics from the ONS, any positive news must come as a welcome respite to contractors. Scotland does seem to be well placed to recover, especially for contractors with experience in manufacturing, services or renewables.

Contractors in other parts of the UK may take solace from the fact that the BCC now says we are unlikely to slip back into recession.

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Do we really need to bribe companies to help young people find work? The Government obviously thinks so and Nick Clegg intends to offer organisations more than £2,000 for each unemployed youth they place in education or employment.

This “payments by results” scheme is designed to prevent young people spending a long period out of work. The UK currently has nearly 1.2 million young Neets (people not in employment or education), 150,000 of whom are under the age of 18. 55,000 of the Neets in the 16 to 17 age bracket do not possess good passes at GCSE and they have a high risk of spending long periods out of work.

£126 million is to be set aside to fund outside bodies that will offer support to Neets and provide them with skills training and practice in interview techniques. Private sector groups and charities will be paid based on their success with Neets. The most successful will receive £2,200 for every client;  money which will be taken from the budgets of the Department for Work and Pensions and the education department.

Mr Clegg points out that it’s a tragedy that young people have to sit at home doing nothing. Although this is not a new problem, we must improve our efforts to provide teenagers with the confidence, skills and opportunities they need to become successful.  The new scheme is part of the Deputy PM’s £1 billion fund to tackle the problem of youth unemployment.

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Umbrella company contractors may not be aware that the UK now has a new employment relations minister. Norman Lamb has taken over from Edward Davey and part of his remit is to look into ways to reduce the amount of red tape facing recruiters.

The REC has now announced that it is to meet with the new minister to ensure he understands the valuable contribution the recruitment sector makes to the UK economy.

Tom Hadley, the director of policy at the REC, explained that the immediate priority was to highlight the positive role of recruiters and to ensure the right regulatory landscape and compliance framework were in place to help the sector prosper.

He went on to say that the Red Tape Challenge provided an excellent opportunity to express the industry’s views. Furthermore, the REC hopes the Department for Business will continue to fight for the sector on overall employment policy and more specific issues such as pensions’ reform and taxation.

Meanwhile, the latest Report on Jobs from the Confederation showed that permanent placements in six out of the eight sectors surveyed increased last month. Amongst the sectors showing positive growth were IT, engineering and office professionals. Demand for hotel and catering staff declined, but that should not come as any great surprise after the festive season.

Kevin Green, the REC’s chief executive, once again pointed out that there was a mismatch between what jobseekers can offer and what employers actually want. Part of the solution would be to provide candidates with better career guidance, he said, as would more apprenticeships that provide young people with vocational skills.

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If you decided to throw a sickie last Monday, you were probably not alone.

Even before the snow blanketed many parts of the country last weekend, research from ELAS suggested that Monday February 6^th was the day Brits were most likely to phone in sick and snuggle back under the duvet. Whilst wintry weather was a factor, commuting in the dark, credit card bills and the long wait until the Easter holidays all contributed to the lack of enthusiasm for work.

The good news for businesses is that the faltering economy has encouraged employees to reduce the number of fake sickness days they take. The majority of staff now only absent themselves from the office for one day.

ELAS’ head of employment law, Peter Mooney, said the employment law consultants had been closely monitoring absenteeism for some years. A significant number of skivers take two days off to make their sickness appear more believable. However, over the past year, that trend seems to have stopped as the struggling economy forced managers to clamp down on absenteeism.

Mooney went on to say that there appears to be a steady increase in the number of people who throw a sickie, but the length of absence is decreasing. ELAS estimated that 400,000 workers in the UK would be ‘sick’ this past Monday.

You would think that people would be grateful to have a job and would do everything to retain it, but the ELAS research has shown that is not true. With all the doom and gloom surrounding the country at the moment, people seem to think they are entitled to the perk of an occasional day off work, Mooney concluded.

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Four months after the AWR were implemented there is still an area of uncertainty surrounding the position of limited company contractors.

The AWR summit last week discovered that the recruitment sector is divided as to whether or not limited company contractors are inside the scope of the Regulations. About 100 delegates attended the summit and the split was roughly 50:50 when the question arose.

Even members of the panel appeared to have differing views on the subject. Tim Johnson, head of Tim Johnson Law, told attendees that workers need to have an employment contract, or agree to work personally with an agency, before they come under Agency Workers Regulations. However, company contractors do not enter into such a contract, nor do they personally agree to carry out the work, and therefore they are not affected by AWR.

Kevin Green, the REC’s chief executive, on the other hand said that limited company contractors are not automatically outside AWR, although their status was good evidence to suggest that they might be.

Other members of the panel believed that the acid test was whether a worker was outwith IR35. If so, they were likely to also be outside AWR.

Some recruiters have complained that temporary staff are having their contracts terminated before the qualifying twelve week period is up whereas prior to AWR the contract would have continued. One recruiter has suggested that temps either be allowed to opt out of AWR, or the 12 week qualifying period is extended, so that they can remain in employment.

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Contractors and freelancers may have been wondering where to turn for advice after the government funded Business Link advice network closed down.

Actually, a large number of private sector support initiatives have been launched recently and now StartUp Britain has produced an online calendar listing 600 events that will be beneficial to entrepreneurs and other small business owners.

Business minister, Mark Prisk, said one of the aims of the calendar was to give budding entrepreneurs the confidence to go it alone. People need to know where they can turn for support and advice and the calendar shows that help could be right on the doorstep.

The government wants this year to be the year of enterprise and will be providing more opportunities for new start-ups and existing small businesses that want to grow, Prisk continued.

Despite the government’s enthusiasm for self-employment, recent research from Aviva has discovered that around 25% of small business owners are thinking about packing it in and returning to salaried employment.

A third of the respondents to Aviva’s survey said they no longer have the same level of enthusiasm that they had when they first launched their own business. Furthermore, more than 25% said they no longer enjoyed being a business owner.

50% of the surveyed entrepreneurs said they were now drawing less money out of their business than they were 2 years ago. Restaurant owners in particular have been hit hard, with 73% witnessing a decrease in the amount they could take from the business.

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Some umbrella company contractors have been getting anxious in case HMRC uses the newly proposed GAAR to hound them.

It was recently revealed that the Chancellor might include a general anti-avoidance rule in the next budget. Contractors have expressed concerns that this could be added to IR35 as a way of policing their employment status. However, a number of experts believe these fears to be unfounded.

CIOT director John Whiting said he did not think contractors needed to be concerned about that a GAAR will have an affect on their employment status unless they have set up an artificial structure.

He went on to say that the March budget is likely to include a GAAR but it is unlikely that this would target contractors working through a company or that it would be used to police employment status.

Paul Mason from Abbey Tax, the IR35 compliance company, said the majority of freelancers and PAYE umbrella contractors working through limited companies would not be affected by a GAAR, unless they work through an offshore-trust arrangement.

The general anti-avoidance was proposed after Graham Aaronson QC conducted an extensive study. The aim of the rule is to deter contrived schemes that use an artificial structure. John Whiting believes that contractors working through a company are highly unlikely to be affected by it. Policing of employment status is already covered by numerous rules including IR35 and MSC, he added.

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Freelancers who search online marketplaces for contracts may be interested to learn that Elance has just secured funding worth £10.3 million to aid its growth plans.

The global work platform is expecting more businesses to take advantage of the cloud to increase their contingent workforces.

Existing investors Kleiner Perkins Caufield and Byers and New Enterpise Associates have been joined by the Stripes Group to provide the capital for expansion.

Elance’s chief executive, Fabio Rosati, said there is a clear structural shift away from the traditional 9-5 office based employment model.  Contractors can now choose to work online with several clients and organisations are making it part of their core business strategy to hire online teams. He went on to say that the new investment will help Elance keep abreast of demand and continue to be innovative in its approach to work.

Since 2010, Elance has seen an increase of more than 120% in the number of professionals working through its platform. Furthermore, the company’s European Online Employment Report for 2011 showed the freelance market in the UK is booming with 55% more businesses hiring online.

The UK comes in at number one amongst the European countries hiring online workers, and in the third quarter of last year, it was third worldwide. In the European league table, Germany comes in second place, followed by Switzerland and Holland.

Businesses in London hire the largest amount of contractors through Elance, but the popularity of the site is also growing rapidly in Birmingham, Reading and Edinburgh.

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Umbrella contractors in the construction industry could be amongst those to benefit from the government’s decision to let the High Speed Two rail link go ahead. It is thought that HS2 could lead to the creation of as many as sixty thousand jobs.

HS2 Ltd released a statement saying thousands of jobs will be created by the scheme, while a leaflet from the Department for Transport optimistically says that tens of thousands of new opportunities will be forthcoming, particularly at West London’s Old Oak Common and Eastside in Birmingham.

Last November, a government transport committee said that HS2 would create 40,000 jobs in London. Around half of these will be at Old Oak Common, which is in the Hammersmith and Fulham borough.

Colin Buchanan, a town planner, says the project has the potential to create more than 115,000 employment opportunities across North-West London. HS2 is expected to create a further 22,000 jobs in the West Midlands.

Councillor Mark Loveday explained that HS2 will deliver much needed employment opportunities in one of the poorest areas of London and the government recognised that the case for an interchange at Old Oak was overwhelming. According to a spokesman from Hammersmith and Fulham, the area around Old Oak has an unemployment rate of around 50% and some parts class as most deprived.

The leader of Birmingham City Council, Mike Whitby, says HS2 is probably the most important opportunity the region has seen for economic growth for generations.

Construction of HS2 is scheduled to begin in 2017 and should be operational in 2026.

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The REC is keen to encourage the government to take action to help Britain’s unemployed youngsters, some of whom might become umbrella company employees, obtain meaningful employment.

The Confederation has now sent a letter to the Deputy Prime Minister, Nick Clegg, explaining that recruiters have a vital contribution to make in promoting the recently launched Youth Contract scheme.

Under the scheme, employers will receive up to £2,275 from the government for each person between the age of 18 and 24 they take on from the Work Programme. The CBI first put forward the idea, although the REC did campaign for the government to provide incentives for job creation back in 2010 as part of its Youth Employment Taskforce.

The director of policy and professional services at the REC, Tom Hadley, explained that the Confederation have been pushing for monetary incentives for two years. Whilst it might be limiting to focus incentives just on those who qualify for support from the Work Programme, it is an important step in the right direction. The Government is now prioritising the problem of youth unemployment and concrete measures are being taken to tackle it.

He went on to explain that recruiters are already working with schools and colleges and also promoting the benefits of internships and apprenticeships to their clients. The REC’s Youth Employment Charter aims to highlight this contribution and stimulate more activity.

The government still needs to devise an effective network that will provide careers guidance for the UK’s young people. However, Hadley points out that recruiters can also be relied upon to provide advice to jobseekers and help them decide which career path to follow.

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Umbrella company contractors who have undertaken psychometric tests might be interested to learn the Talent Q believes some recruiters are misusing them.

The workplace assessment specialist went as far as to say that recruiters could be jeopardising their employer brand if they do not use the tests correctly.

An increasing number of organisations use the ability and personality tests to sift and select candidates. But recruiters do not necessarily explain the relevance of the tests to the applicants. Furthermore, they do not give the candidates any feedback, which is a breach of the British Psychological Society’s requirements.

Some recruiters do not have a centralised record of the data collected from psychometric tests and this results in duplication, leading frustrated candidates to think the employment agency is inefficient. Candidates are also entitled to an explanation if their application was unsuccessful, and all too often they blame the tests, even though other factors may be to blame.

Talent Q UK’s chief executive, Steve O’Dell, said job applicants are getting a bad experience from recruiters who misuse psychometric tests. This can cause irreparable damage to the recruiter’s brand and reputation.

It is good practice to provide clear information about what the assessments are designed to achieve, and help contractors plan proactively to take them. Assessments should be relevant and feedback should be provided throughout the entire application process. The company also said that a verification test should be conducted when the applicant reaches interview stage.

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