Public sector pay is likely to be frozen due to the state of public finances, according to recruiters.

October’s Office for National Statistics provisional estimates of the public finance figures reveal a current budget deficit of £7.7bn, net borrowing of £11.4bn, while at the end of October 2009 net debt was £829.7bn - 59.2% of gross domestic product.

David Kern, chief economist at the British Chambers of Commerce (BCC), says: “The size of the public sector must be pared back significantly over the next few years, so as to allow private firms to generate the wealth necessary to drive economic growth. As an initial step, and while inflation is still low, public sector pay could be frozen without causing undue pain.”

Helen Stokes, managing director - public sector at Morgan Hunt, says it would be naïve to suggest that the public sector workforce will be unaffected by the debt and predicts pay freezes and job cuts but not all areas will be impacted negatively. 

“The level of change faced by the public sector in itself presents opportunities - in the short term, HR and employee relations (ER) specialists will certainly be in demand, and beyond that we foresee change management and organisational development as a growth area.”

But Anthony Pierce, associate director HR reccruitment at Hudson, says that while public sector pay was likely to be frozen, this would not necessarily mean an increase in the hire of ER specialists in the public sector.

“ER specialists were not in mass demand a year ago in the private sector. People in HR roles may have been the last employees to leave and the HR function may have managed the ER organisations but companies did not hire rafts of ER specialists. They got their generalist people to manage the programmes.”