'Recession here and 350,000 jobs will go'

Published on Monday 6 October 2008 21:44

THE UK is already in a recession, with business confidence, profits and turnover now at record lows and unemployment set to rise by up to 350,000 in the next year, according to an "alarming" new report out today.

An authoritative survey of 5,000 firms by the British Chambers of Commerce (BCC) for the third quarter of the year showed a worsening economic outlook and rising unemployment amid a "collapse" in confidence.

The business group said it was clear the UK was now in a "worsening" recession and urged the government and the Bank of England to take urgent action to avoid a "major" recession.

The Bank's monetary policy committee (MPC) was urged to cut interest rates by 0.5 per cent when it meets this week, while the government was told it should slash business taxes.

Employment expectations among the firms polled were the worst since 1993 and the BCC warned that the jobless total was expected to increase by between 300,000 and 350,000 over the next 12-24 months, which would take the total over the two million mark.

David Kern, economic adviser to the BCC, said: "The results support the view that a UK recession has started and the downturn is getting worse. The domestic economy is under immense pressure."