Jobs cutting will speed up, says CBI
Manufactures expect to cut jobs over the next quarter at a faster rate than the last three months to October, according to the CBI.
“The decline in headcount was broadly in line with expectations, though firms expect to cut jobs at a moderately faster rate over the next three months,” the business group announced in a gloomy survey.
CBI deputy director-general 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.”
The CBI also indicated that orders and output had fallen at a higher rate than expected.
Domestic orders in the last quarter deteriorated at their fastest rate in two years, and the CBI blamed that on the continued weakness in British consumer spending.
But manufacturers said they expected the decline in new orders to ease in the next three months.
All in all, 34 per cent of manufacturers reported a drop in orders in the last quarter, while 20 per cent said they rose.
Output declined, despite expectations of a modest increase.
Thirty two per cent said their output had fallen, and only 19 per cent reported it had risen.
The CBI said: “Looking ahead, output is expected to be broadly unchanged over the next three months.
Manufacturers also gave a gloomy outlook about the general business environment, indicating softness in the sector could continue. Exports fell to the lowest level since October 2003.
The gloomy outlook for manufacturing in England contrasts with the recent improvement in Europe.
Earlier this week, an Ifo survey into business sentiment in Germany, the biggest economy in the euro zone, showed confidence returning as the political stalemate ended and oil prices declined.