...But Skype hires 400 and puts 100 workers in new London hub

SKYPE yesterday unveiled an expansion plan that will see the online phone group increase its European presence and hire 400 extra people across five cities worldwide.

The Microsoft-owned company, which already has an office in the West End, is upping its London workforce by 100 and opening a new technology centre in the city.

Skype is hiring software engineers, product managers and designers for its new London location, and looking to recruit staff for its recently formed Xbox division.

This will come as good news to George Osborne, who announced in the Budget that he wanted the UK to become the technology hub of Europe.

Skype, which was bought by Microsoft for $8.5bn (£5.3bn) in October, will have 1,600 employees worldwide after this hiring round.