Press Release

Economic gloom – senior executives in local government sector call for long-term focus

13 October 2008

A poll of 1,118 senior executives reveals that local government sector managers and leaders are calling for calm in the face of the continued economic gloom.  Respondents to a survey, published today by the Chartered Management Institute, argue that the temptation to make knee-jerk responses must be held in check by experience and considered, decisive, action.
 
The survey shows that just 1 in 5 individuals feel secure in their current job in the local government sector.  However, although half (52 per cent) admit that ‘work has become more stressful’, indications are that respondents are able to deal with the pressure. For example, 73 per cent in the sector view the downturn as presenting them with ‘greater challenges’ and almost one-third (28 per cent) say it has ensured they are ‘more focused at work’.  Only 25 per cent claim that fears over the economy have caused them to ‘lose sleep’.
 
In a sign that local government managers have confidence in their ability to deal with the current situation, the study shows that a significant proportion are still keen to take risks (28 per cent) or accept extra work (60 per cent).  Many are also not prepared to ‘sit tight’ during the downturn, with 69 per cent suggesting they would be ‘tempted to move if the right offer came along’.  Perhaps surprisingly, 52 per cent claim to be ‘actively looking for a more senior position’.
 
The research also identifies the top factors currently putting most pressure on the financial performance of UK organisations.  Rising energy costs top the list (32 per cent), followed by concerns over employee motivation (29 per cent) and weak demand (27 per cent).  However, despite a clear majority (59 per cent) admitting that the current state of the UK economy is having a negative impact on their organisation, just under a half (45 per cent) are either ‘optimistic’ or ‘very optimistic’ about business prospects in the next 12 months.
 
Asked to justify this positive outlook, it is clear from the research that the sector’s managers and leaders believe that a combination of experience, decisive action and long-term planning is the key to business survival:
 
- past practice:  48 per cent in the local government sector have previous experience of redundancy and 35 per cent have supported friends or family through redundancy.  With this in mind, almost three-quarters (75 per cent) argue that there is now less stigma attached to redundancy than in the 1990s
 
- action, not words:  34 per cent of respondents in the sector say their organisation has already frozen recruitment, with 42 per cent diverting attention to developing the skills of core internal staff.  85 per cent also argue that focusing on management and leadership skills will help them survive the recession
 
- long-term approach:  68 per cent in the sector suggest that ‘organisations should focus on product innovation and service’ to stay afloat in the downturn.  The idea of investment is backed up with only 36 per cent agreeing that ‘the best response to recession is to cut costs’
 
Jo Causon, director, marketing and corporate affairs at the Chartered Management Institute, says: “In these challenging times, it has become more important than ever to demonstrate strong leadership.  It is vital that the UK’s leaders remain composed in the face of growing economic pressure because knee-jerk reactions will only serve to exacerbate the problem.  It’s easier to manage when times are good, but the current climate is a real test of how strong the UK’s leadership credentials really are.”
 
Responding to the findings of the survey, the Chartered Management Institute will be launching a micro-site at the end of October 2008, designed to provide employers and individuals with resources to help lead them through the downturn.  The resources, which are free to download will be available via www.managers.org.uk/however and include videos, podcast and ‘how to’ checklists covering topics ranging from ‘how to recession proof yourself’ and ‘standing out from the crowd’ to ‘preparing your organisation for the future’ and ‘build partnerships.’