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HSBC announces £12.5 billion rights issue and job cuts

HSBC has this morning confirmed a £12.5 billion rights issue and the loss of 1200 jobs in the UK. While this comes as no surprise to those in the industry it is a further blow for the UK job market as more and more observers forecast significant job cuts in the future. The 1200 jobs at risk will be spread amongst the company's operations in the UK as it seems there is no hiding place from the ongoing depression in the sector.

As you would expect, the bank has been forced to make these cost reductions due to significantly lower levels of business in the UK, the need to cut costs in general and the fact that the UK mortgage market in particular is dead at the moment. For those left with employment positions in the financial industry it is most definitely a case of short-term pain for long-term gain although when we will see a significant uplift in the sector is uncertain at this point.

UK unemployment continues to rise and it is the financial sector which is currently taking the brunt of job losses. Many experts believe that unemployment will rise to over 3 million before employers begin to take on staff with the short to medium term outlook for the UK economy is very mixed to say the least.

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