Unemployment Rates Reassure UK Economists
Amid the turmoil in the worldwide stock markets, and bank losses, the job market in the UK has been positive. The latest data showed that the UK is enjoying the largest increase in the number of jobs in 11 years. The number unemployed and those claiming unemployment benefits fell consistently for the last 15 months. This is the longest stretch of declines since June 2003, and resulted in the lowest unemployment rate since 1975, according to a report by Guardian Unlimited.
This is good news for the UK economy, which is fighting to stave off the recession that hit the US in the third quarter of 2007.
There will be job losses, but they are expected to be contained within the financial community. Last week, credit-checking specialists Experian announced that they will lay off hundreds of staff. The Banks are tightening mortgage and personal loan lending criteria. This has caused a serious slow down.
City group also announced they will reduce their work-force by more than 4000 employees.
The Royal Institution of Chartered Surveyors forecast an estimated 123 people will lose their homes every day in the coming year as the impact of the credit crunch feeds through the economy.
Consumer fear is the most dangerous threat to the UK economy. UK adults are still reeling from five interest rate increases, the Northern Rock crisis, recent increases in oil prices, higher utility bills, debt-laden homeowners, and the thousands of jobs lost this year that are biting deep into consumer confidence. Spending and retailers are preparing 'for a bumpy ride' over the next few months.
The only good news is that the current crisis will put pressure on The Bank of England to lower rates at least two more times this year.
Published on January 30, 2008
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