Manufacturers Say Sector Will Lose 140,000 Jobs
About 140,000 jobs will be lost in British manufacturing this year, according to the EEF industry group, which has raised its forecast by more than half.
The warning comes as evidence grows of a dramatic collapse in business confidence across the economy, with more job losses and business failures due to be announced this week.
The EEF manufacturers' organisation raised its prediction on job losses after the worst figures on record from a survey of members and their business confidence. The EEF, which has conducted quarterly surveys of confidence since the early 1990s, has sharply revised its economic forecasts after the results, which it says underline the severity of the downturn.
According to the EEF, 39 per cent more companies expect to cut output than to raise it in the next few months, while for orders the survey showed a negative balance of 54 per cent. In some industry sectors, the outlook was far worse. Businesses in the automotive sector showed a balance of -91 per cent for output and -89 per cent for orders. In the West Midlands region, at the heart of much of the motor industry, the balance on output was Britain's worst, at -63 per cent, while its order balance was -69 per cent, well down from the -31 per cent recorded in last year's final quarter.
Gloom in manufacturing is echoed across the economy, according to a confidence survey by KPMG. It found that 81 per cent of senior executives felt prospects for the British economy to be bad or very bad. In last year's final quarter, 60 per cent had that view. Eighty-seven per cent said that the economy would get worse before it gets better.
The EEF repeated its calls for companies to get help from the Government in paying workers put on short time. The practice is common in other European countries and the group said that there was anecdotal evidence of international companies cutting jobs in Britain rather than on the Continent because they did not receive financial help to retain workers in the UK.
Steve Radley, chief economist for the EEF, said: “There is simply no hiding the fact that these figures make grim reading. The past three months have been extremely difficult for manufacturers, with markets at home and abroad showing severe difficulties. There is now an urgent need to support companies in hanging on to the skilled workers they will need for when the upturn comes. Government must consider all possible avenues to help companies to deliver alternatives to redundancy.”
In a fresh sign of strain on the economy, more job cuts are expected at ITV this week. The broadcaster, which has been hit by a decline in advertising, is expected to announce that 500 jobs will be cut when it reports annual results on Wednesday. It is understood to be considering selling assets including Friends Reunited, the social networking site that it bought in 2005.
Five, a rival broadcaster, is predicted to say this week that it will shed nearly 100 of its 350 staff.
Effects on British retailing from Iceland's woes are set to continue when Mosaic, the owner of retailers such as Karen Millen, Oasis and Warehouse, is put into administration today. Mosaic is 49 per cent-owned by Baugur, the collapsed Icelandic investment group. Kaupthing, the Icelandic bank owed £400million by Mosaic, is expected to take control of the group immediately and to buy back Millen, Oasis, Coast and Warehouse. Two of its chains, Principles and Shoe Studio, will be sold.
The warning comes as evidence grows of a dramatic collapse in business confidence across the economy, with more job losses and business failures due to be announced this week.
The EEF manufacturers' organisation raised its prediction on job losses after the worst figures on record from a survey of members and their business confidence. The EEF, which has conducted quarterly surveys of confidence since the early 1990s, has sharply revised its economic forecasts after the results, which it says underline the severity of the downturn.
According to the EEF, 39 per cent more companies expect to cut output than to raise it in the next few months, while for orders the survey showed a negative balance of 54 per cent. In some industry sectors, the outlook was far worse. Businesses in the automotive sector showed a balance of -91 per cent for output and -89 per cent for orders. In the West Midlands region, at the heart of much of the motor industry, the balance on output was Britain's worst, at -63 per cent, while its order balance was -69 per cent, well down from the -31 per cent recorded in last year's final quarter.
Gloom in manufacturing is echoed across the economy, according to a confidence survey by KPMG. It found that 81 per cent of senior executives felt prospects for the British economy to be bad or very bad. In last year's final quarter, 60 per cent had that view. Eighty-seven per cent said that the economy would get worse before it gets better.
The EEF repeated its calls for companies to get help from the Government in paying workers put on short time. The practice is common in other European countries and the group said that there was anecdotal evidence of international companies cutting jobs in Britain rather than on the Continent because they did not receive financial help to retain workers in the UK.
Steve Radley, chief economist for the EEF, said: “There is simply no hiding the fact that these figures make grim reading. The past three months have been extremely difficult for manufacturers, with markets at home and abroad showing severe difficulties. There is now an urgent need to support companies in hanging on to the skilled workers they will need for when the upturn comes. Government must consider all possible avenues to help companies to deliver alternatives to redundancy.”
In a fresh sign of strain on the economy, more job cuts are expected at ITV this week. The broadcaster, which has been hit by a decline in advertising, is expected to announce that 500 jobs will be cut when it reports annual results on Wednesday. It is understood to be considering selling assets including Friends Reunited, the social networking site that it bought in 2005.
Five, a rival broadcaster, is predicted to say this week that it will shed nearly 100 of its 350 staff.
Effects on British retailing from Iceland's woes are set to continue when Mosaic, the owner of retailers such as Karen Millen, Oasis and Warehouse, is put into administration today. Mosaic is 49 per cent-owned by Baugur, the collapsed Icelandic investment group. Kaupthing, the Icelandic bank owed £400million by Mosaic, is expected to take control of the group immediately and to buy back Millen, Oasis, Coast and Warehouse. Two of its chains, Principles and Shoe Studio, will be sold.
source: The Times Online
