Economic gloom seems to have become unrelenting as it has penetrated further into the British manufacturing sector and an increasing number of companies are considering axing jobs in attempts to reduce costs, the CBI reported.
The Confederation of British Industry (CBI) stated in its latest research that orders and supplies at factories and manufacturers were continuously dwindling, more so at an unprecedented rate.
Overall, as many as 34% companies posted a fall in orders over the quarter ending October, while 20% said that there was a rise. However, proof that the rate of fall had escalated was evident in the balance which reached minus 14 against minus 7 in July.
Deputy Director General at CBI, John Cridland said, “Rising raw material and energy prices have continued to push up costs and hit profits. Against this background firms are cutting back on their investment plans and expect the rate of job losses to increase.”
Besides, domestic demand followed the downturn too, as 35% firms recorded plummeting orders in the three months, and a meagre 12% posted an increase. Likewise, export orders reported a fall in 30% of firms.
Cridland added that the quarter had already lost a whopping 21,000 jobs and another 24,000 were likely to happen by this year’s end. Lamenting at the “disappointing” results, he added, “It looks as though growth in 2005 is not going to be what we would have all hoped and that the slowdown has been sharper. We believe that the next change in interest rates should be downwards because we see the risk of the slowing of the economy.”
Posted
on : Thu, 27 Oct 2005 15:15 GMT | Business News
By : Chris Rowe
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