§ 45. Mr. Jessel
asked the Secretary of State for Employment what estimate he has made of the extent to which employers have been deterred from taking on additional labour by the Employment Protection Act.
§ Mr. Harold Walker:
The report by the Policy Studies Institute,"The Impact of Employment Protection Laws ", published in June, found that there was very 104W little sign that employment protection legislation was discouraging employers from taking on new people.
A survey of firms employing fewer than 50 people was undertaken for the Department by Opinion Research Centre earlier this year. Only 2 per cent. of respondents initially listed employment legislation as the main difficulty in running their business. When asked specifically about the effects of employment legislation, 7 per cent. indicated some reluctance to take on more staff. Later, when asked directly if they would have employed more people but for the legislation, 24 per cent. replied that they would. However, 40 per cent. Of these had earlier indicated that no provisions of employment legislation were affecting their business and 79 per cent. had not found any particular piece of employment legislation troublesome when given a specific list.
I believe therefore that, although some employers use the Act as an excuse, it is not a significant reason for their failure to take on additional labour.