Credit Crunch Today

End of beginning as downturn slows slightly

The seasonally-adjusted CIPS/Markit Purchasing Managers’ Index (PMI) rose to 42.9 in April from 39.1 the previous month, but was lower than last year’s figure of 49.7.

Despite remaining below the neutral 50.0 mark (a figure less than 50 indicates a contraction) for the 13th month running, the PMI moved further from February’s joint survey record low.

April saw a marked easing in rates of contraction for output and new orders, with cost considerations driving further cuts in employment and inventories and output prices dropping at survey record pace.

There was a substantial reduction in manufacturing employment, with more than one-third of companies reporting job losses. Large-sized companies continued to cut staffing at a faster rate than SMEs.

Roy Ayliffe, Director at the Chartered Institute of Purchasing & Supply, said: "Although April saw some reprieve for the UK manufacturing sector, we are still far away from a turn-around and the industry is firmly embedded in the trenches of the recession."


Unemployment hits highest level under Labour

Unemployment rose by 177,000 in the three months to February to reach 2.1 million.

The jump is the biggest quarterly rise since 1991.

The number of people now out of work is at its highest level since Labour came to power in 1997.

Unemployment has passed the two million mark for the first time in 12 years - and it is feared it could reach three million by the end of this year.

The percentage rate of those without work is currently 6.7% but experts believe it could soon reach double digits.

Figures released by the Office for National Statistics (ONS) for the three months ending February 2009, show that the UK employment rate has fallen to 73.8%, down 0.4 from the previous quarter and down 1.1 over the year.

The Monster Employment Index UK decreased by seven points in March, reversing the seasonal increase in online recruitment seen in February. Year-on-year, the Index was down 77 points, or 41% – the steepest annual decline on record.