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Britain is booming. Not the economy, of course, but the population. According to new projections just published by Eurostat (the EU’s very own army of statistical data crunchers) the number of people living in the UK will grow by a quarter in the next 50 years. By then some 77 million people will be crammed together on this sceptred isle – making us easily the largest EU nation in terms of headcount, accounting for 1 in 6 of half a billion European comrades.

I’m almost relieved to know that I probably won’t still be around to experience this – there’s already barely room to swing a cat with just 60 million poor souls vying for available space. No need to get too bothered yet though. Population projections are simply that – projections, based on current trends plus assumptions about what will happen in the future. Eurostat itself calls them ‘what-if scenarios’ which “aim to provide information about the likely size and structure of the population”. There is no guarantee things will pan out exactly as assumed. All manner of things might happen. War, climate change or pestilence could make a big difference to the outlook (fortunately famine isn’t on the cards, we Brits being too prone to binge eating and drinking for that).

The big ‘what if’ is the outlook for immigration. Net migration (statisticians love to talk complex) accounts for at least half the projected rise in UK population (more when you note that immigrants, being younger than the average person, are also more active when it comes to driving up the birth rate). Yet we also know that immigrants are fickle. As UK Home Office figures published last week show, the number of people from Eastern Europe crossing our shores in search of work has started to dwindle. Half those who have arrived since 2004 have since gone back home. All of a sudden dinner party talk of a proliferation of Poles is being replaced by wonderment at their apparent rarity.

The only real demographic certainty we can look forward to is population ageing. Even if immigration continues at a high rate Britain will be getting greyer. By 2060 1 in 4 Brits are projected to be aged 64 or above and 1 in 10 aged over 80 (roughly double the current proportions). Without immigration the ‘oldie rate’ will be higher. We all know this. We talk about it as much as we do about immigration. But I’m still not convinced that we – organisations, the HR community or society at large – have fully woken up to the implications.


John Philpott will be speaking at the CIPD annual conference and exhibition in Harrogate, on 16-18 September.

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I’m beginning to forget which season we’re in. I know it's August, but the view from my window – a mix of sunshine, showers and blustery wind - is more reminiscent of April or September.

Bank of England governor Mervyn King is in a meteorological mood today too. I’ve just been watching the quarterly inflation report press conference. The governor opened by saying, “It may still – just – be summer, but there is a feeling of chill in the economic air.” You bet there is, Mervyn – and there was little else in what he had to say to warm me up.

According to the governor the economy is going through a painful adjustment that cannot be avoided. Economic growth is likely to stagnate over the next year with the rate of inflation set to reach five per cent before falling back again. And just how much pain is to be expected also became clearer today in the latest labour market figures from the Office for National Statistics (ONS). These show a 60,000 rise in the number of people out of work and looking for a job in the three months to June. There were also 20,000 more people claiming jobseeker’s allowance in July – the biggest monthly increase since 1992.

This is easily the weakest set of labour market data since the credit crunch began. Employment growth has ebbed to a trickle – indeed, employment has fallen in several regions of the country - while the rise in unemployment is gaining momentum. The impact of the economic slowdown is also becoming more widespread. Nearly every sector of the economy is posting fewer job vacancies. This is particularly evident in those parts of the private sector that, until recently, were major centres of job creation such as shops, hotels and restaurants, finance and business services, and construction. And there is a clear sign that redundancies are on the rise as well.

Moreover, these figures only tell us what was happening to the jobs market until mid-summer. Worryingly, the latest CIPD/KPMG/Ipsos MORI Labour Market Outlook survey – published earlier this week - indicates that the situation will continue to deteriorate in the coming quarter. By the end of the year it is likely that the level of employment will be falling across the country and unemployment rising at an accelerating pace as the number of people claiming jobseeker’s allowance climbs back toward 1 million for the first time this decade. Chillier times indeed.

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The summer party season is in full swing. My favourites are those hosted by the foreign ambassadors (Ferrero Rocher and all). The best are the American Independence day and French Bastille day gigs. Being neither great or good myself I spend most of the time celeb watching and naively wondering what it is that attracts beautiful young women to less than handsome rich men at least twice their age.

In this realm of grandeur, stars of stage, screen, music and literature mingle easily with politicians, statesmen and senior business types. There were relatively more of the latter at the Financial Times (FT) party the other night which is perhaps why the generally convivial mood of Kensington Palace was tinged with an air of menace. At first I thought this was because the waiters and waitresses all wore white tunics and black bowler hats. It seemed a bit Clockwork Orange to me. But the real villain was the economic and business outlook.

The FT’s respected editor Lionel Barber informed the gathering that we are only at "the end of the beginning of the credit crunch" with the full impact on the real economy (for which read jobs and living standards) still to be fully felt. This must have made uncomfortable listening for chancellor of the exchequer Alistair Darling, surrounded as he was by both friend and foe. I noticed him in polite conversation with a senior BBC political journalist who only hours before had predicted Mr Darling would be the biggest casualty of an impending cabinet reshuffle. After the year he’s had, leaving the Treasury might be as much a blessed relief as a personal disappointment. And if possible he can take consolation in the fact than any politician of any party would have struggled to cope with the tide of economic trouble currently washing over us. The party may soon be over for the chancellor – but life’s not going to much fun for any of us in the remainder of this year and next either.

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In today’s age of constant email there is something almost touching about an exchange of letters, bringing to mind as it does the image of Jane Austen’s fiery Elizabeth Bennett, her dashing Mr Darcy, and correspondence laced with unspoken passion. Unfortunately, this week’s highest profile letter writers, the governor of the Bank of England, Mervyn King, and the chancellor of the exchequer, Alistair Darling, have been concerned with the rather more mundane matters of explaining to Joe Public why consumer price inflation is running way ahead of target and outlining what is being done to try to keep the lid on price rises.

Mervyn’s letter to Alistair stresses the importance of ensuring that pay settlements do not accelerate in response to the current sharp increase in fuel and food prices. Alistair writes back in agreement, noting that “to return now to inflationary pay settlements would undermine rather than raise people’s living standards with a damaging circle of wage increases eroded by steadily rising prices”. My own view on this is that the economy is unlikely to experience an old-style “wage- price spiral”. But I strongly agree with the chancellor that average pay rises must remain modest for the time being.

The code in the governor’s letter is that, come what may, British workers will have to accept a significant squeeze in living standards in the coming months. If this doesn’t emerge through below inflation pay settlements the pain will be felt in the form of higher interest rates, a more significant economic slowdown and a bigger rise in unemployment than already on the cards. In other words, if there are inflation matching pay hikes the consequence will not be a damaging pay-price spiral of the kind the economy has experienced in times past but instead fewer jobs.

The good news is that there is little sign of mounting pay pressure in the economy. Compared with previous eras when trade unions were significant players in the private sector, and pay often automatically followed increases in living costs, employers are better able to keep pay rises in check even when inflation is rising. However, it is vital that restraint is maintained in this current period of sharply rising prices.

The chancellor is therefore absolutely right to call for continued pay restraint in both the private sector and public sectors and it’s good to hear that government ministers and some other leading politicians will forsake a pay increase this year. It would be great if leaders in the private sector were to follow suit both in conveying to staff the importance of responsible pay deals and demonstrating that restraint will be observed at every level from the board to the shop-floor and office.Comments [0] “The Phoenix has landed.” When announcing the successful touchdown recently of an unmanned spacecraft on the surface of Mars, NASA clearly sought to evoke memories of the first moon landing in 1969. In Britain today, however, talk of the red planet is just a likely to bring to mind the glam rock era of the early 1970s. The recent popular television series Life on Mars, with David Bowie’s haunting refrain providing the mood music, portrayed the experiences of a contemporary police detective who, having been knocked down by a villain’s car, falls into a coma and wakes up in the alien – and at any rate far less politically correct – world that was Britain in 1973.

For people of my age – I was a not so sweet 16 that year – the series was a reminder of how much has since changed. But Phyllis Self, featured in “Career Ladder” in the May 29 issue of PM, was already making pioneering strides toward the 21st century. Self obviously cuts a remarkable figure at present in her role as personnel director of Whitehall Garden Centres in the Bristol area. At the ripe age of 100 Self is easily the nation’s (perhaps the planet’s) oldest HR professional. However, she was doubtless exceptional in 1973 too in taking on the role when already past state pension age.

Fifty-somethings like myself may not be too keen on the idea of working for another half century. But ever more of us are prepared to follow Self’s lead and work beyond the age of 65. The number currently doing so is fast approaching 1.5 million and is set to increase over the coming years, though in many cases because of financial necessity given pressure on pension income rather than a clear desire to keep on toiling. Interestingly, the rise in older workers is entirely down to improved job retention (there is no firm evidence that employers are hiring lots more of the grey brigade). While this in itself might be seen as encouraging it is potentially worrying, especially with an economic slowdown on the horizon.

When it comes to employment opportunities, older workers have been the single biggest winners from the economic stability of the past decade or so. This is mainly because large-scale redundancy has been the exception rather than the norm (indeed redundancy remains at a record low). If this were to change it is possible that older workers will be first in the firing line for any job cuts. Unlike previous eras there is at least now some protection from anti-age discrimination legislation. But the continued existence within the law of a default retirement age of 65 could give less farsighted employers a get-out clause enabling them to “retire” older staff. Those tempted to do so should look at the example of Phyllis Self and think twice.Comments [0]

If, like me, you’re still munching the Easter egg dregs, you’ll agree it’s possible to have too much of a good thing. It seems John Hutton, secretary of state for business, enterprise and regulatory reform (BERR), thinks the same about the statutory right of employees to request flexible working.

Hutton reckons the right – introduced five years ago for employees with children aged under six or disabled, and extended last year for those with an adult to care for – has greatly benefited working parents, carers and employers alike. The law has pushed on an open door, with hardly any requests from among the 6 million eligible employees being turned down and the use of flexible-working practices on the increase. But when it comes to the case for going further, as advocated by voices as diverse as the TUC, the CIPD and the Conservative Party, he urges caution. The danger, the business secretary warns, is that employers could be so overwhelmed by requests that they will reject more and find it harder to decide which to accept.

Rather than simply extend the right to all workers – as the CIPD and TUC would like to see – or automatically adopt Tory policy and include all working parents, Hutton is waiting at the checkout to hear what Imelda Walsh, J Sainsbury’s HR director, has to say. Her soon-to-be-published independent review – announced by Gordon Brown last November with a fanfare of work-life balance rhetoric – has been skillfully reined in so as not to frighten the horses. Walsh’s task is essentially to recommend whether, and by how much, the current child age limit of six years for eligibility to the right to request should be raised. Extending the right to parents with a child in primary school would make more than 2 million more employees eligible. Drawing in parents who need to cope with hormone-crazed or binge-drinking adolescents would increase the number still further.

It’s likely that, following the Walsh review, ministers will raise the age limit. My hunch is that this will happen in stages with an age ceiling probably set at 14. The business lobby should be able to live with this while the Conservatives will claim that the government has moved in their direction. The CIPD and flexible work lobbyists will be immensely disappointed, contending that such a half-hearted move risks creating a divided two-tier workforce, with childless workers feeling hard done by and employers under little pressure to move faster on introducing progressive working time practices. Yet despite this, one can appreciate the rationale for taking a cautious step-by-step approach to this policy.

Policy makers need to strike a sensible balance between improving working conditions and not putting an undue burden on business. Moreover, the common good requires that the priority should be to help working parents to rear the next generation of citizens and for working carers to support the needs of sick, frail and elderly relatives. From a public policy perspective this is far more important than making it easier for those without such responsibilities to juggle work with leisure activities.

There is, of course, a strong business case for helping all staff achieve a better work-life balance. The CIPD and other like-minded bodies are right to make this case to employers as loudly as possible. But when it comes to placing further legal obligations on employers, ministers are wise to prefer limited change to gung-ho intervention. Those who advocate flexible working should therefore themselves be flexible and understanding in their response to the government’s stance on extending the right to request.

John Philpott, chief economist at the CIPD, writes here in a personal capacity.

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