Unemployment starts to pick up
News of an increase of 32,500 people claiming unemployment benefit in August pushed the UK figure to 904,900 and was not well received by the market. The figure is expected to break the 1,000,000 barrier prior to the end of 2008 and it looks as though 2009 will not start off much better.
However, the wider unemployment rate is substantially higher with 1.72 million people in the UK out of a job and set to rise quickly over the coming months. The two figures are different because of the way other benefits and employment schemes are treated - in affect massaging of the figures.
We are now looking at prospects for the UK economy and the UK population which have not been seen since the last recession of the 1990s. Many expect the impact of the current situation to be worse and drag on for much longer with no short sharp shocks available to get markets moving again. At the moment it seems that we are taking one step forward and two steps back with economies stalling under the pressure.
While the UK will move into recession in the later part of 2008 many observers feel that the UK is affectively in a recession at the moment. The headlines will get worse and sentiment is sure to weaken in the months ahead with the government facing an impossible mission to get the economy back on track before the next election.
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