UK Redundancy Figures

Posted by Rob

October 15, 2008

The UK has taken a battering in the last year over bad investments (such as Credit Default Swaps) made by large financial institutions leading to unprecedented uncertainty in the economy.

The effect is particularly evident in the United States as well, with Government bail-outs and nationalisation of banks in both countries.

Figures just released show that UK unemployment figures have risen, with some experts predicting that there will be 2m unemployed in the UK by the end of 2008. The statistics show very poor economic stability across numerous sectors with the total number of jobless rising by 164,000 during June to August reaching a total of 1.79m unemployed.

The current unemployment rate stands at 5.7%, an increase of 0.5% over the previous three month period and the highest in nearly eight years. According to the Financial Times, the rise in unemployment is increasing at the fastest rate for 17 years.

With the UK looking ever-more likely to be in an “official” recession very soon, experts look back at the Wall Street crash of 1929. Where lessons learn’t from that crash, how long has it taken to recover from it, and what is the likely direction for the financial system in 2008.

Unlike 1929, the global economic situation is exactly that, Global! Any recovery could take much longer than expected, and this is uncharted territory. There is no historical evidence of such global proportions.

FTSE 100

FTSE 100 (15-10-08)

The interesting figure in the 12 month chart for the FTSE 100 is the fall of over 2300 points, wiping off 35% of the FTSE 100’s value. Building this up again could certainly be a lengthy process!

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