Money Matters, Simplified.
Unemployment in UK to reach 2.8mn in 2010
by Ishita Sood - December 29, 2009 - comments
CIPD, which is the leading institute for managing and developing people in UK, had earlier predicted unemployment to be 3.2 million. Currently, unemployment in UK stands at 2.49 million
London, December 29 -- According to latest figures from the Chartered Institute of Personnel Development, unemployment in U.K. will reach 2.8 million, rising continuously for the first six months of 2010.
CIPD, which is the leading institute for managing and developing people in UK, had earlier predicted unemployment to be 3.2 million. Currently, unemployment in UK stands at 2.49 million.
UK markets show weak picture
UK has so far dealt with one of the worst growth periods in the postwar era. According to a Financial Times analysis, the economy is facing one of the worst returns for stock market investors since 1930s.
However, many experts say that UK’s economy has improved considerably from past one year in spite of the 250,000 job loss in 2009.
Information provided by the Office of National Statistics shows that gross domestic product (GDP) rose by 1.7 percent annually.
However, it is still a weak description for the markets seeing that there is a constant loss in output. Furthermore, growth in GDP has not been consistent across all geographic areas.
Good growth rate can help UK back on track
Edmund Cannon, a professor of economics at Bristol University, says ten-year periods give a clear picture of trends over time.
He says in past one decade, London’s GDP output was only 0.7 percent. Also, the workers productivity rates rose just by an average of 2.6 percent in 2009.
Cannon believes a good growth rate can help UK get back on track.
“If you believe that where we were in 1999 was about trend growth for manufacturing, then just a few years of above-trend growth, say at 4 per cent, should help us get back [to the long-term average rate of growth],” he said.
Dr John Philpott, chief economic adviser to the CIPD, says that for growth to happen it is essential to stop employers from cutting further jobs and keep unemployment at bay.
“If... there was a more immediate cut in public spending - which could be the case if the Conservatives gain power at the general election due in the first half of 2010 - unemployment might peak at a higher rate than we currently forecast,” he said.
Most economists predict that despite the unemployment in UK, the economy will exit recession sooner or later in 2010.