The News Line: News
Wednesday, 8 February 2006
24,000 JOBS UNDER THREAT
Over 24,000 manufacturing jobs are at risk over the next three months as UK firms struggle with falling orders, bosses warned yesterday.
The latest Regional Trends Survey of the Confederation of British Industry and research group Experian, showed a drop in domestic and export orders had hit production throughout most of the UK in the last quarter of 2005.
Companies said they expect profits to remain under pressure during the next three months as high energy prices continue to bite.
The number of firms working below full capacity continued to rise during the final quarter, notably in Wales, followed by Yorkshire and the Humber and the South West.
Putting on a brave face, the CBI and Experian predicted a further 24,000 jobs will go, but they claimed most regions would see marginal declines compared with the steep losses experienced between 2001 and 2003.
Employers in only two regions – Yorkshire and the Humber, and East Midlands – were at all optimistic.
Doug Godden, head of economic analyst at the CBI admitted: ‘With some notable exceptions, manufacturers continue to experience difficult times, with high energy costs continuing to add pressure to profit margins.’
Dimitri Gunawardena, economist at Experian, said: ‘The poor performance of manufacturing in the fourth quarter continues to reflect the weakness of economic fundamentals.
‘A combination of subdued domestic and external demand, coupled with declines in output and employment, has undermined confidence in most regions.
‘In addition, unit costs have been rising and companies’ pricing power is limited, intensifying pressure on margins.’
The joint report, which surveyed over 700 companies, follows recent figures from the CBI, which found factory orders falling at their fastest pace in five months.
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