Umbrella company contractors have no doubt been keeping a lookout for warning signs that the UK economy is slipping back into recession.
People can be forgiven if they seem unsure about the direction the country is heading in, especially when the experts seem to have differing opinions.
The CBI has now predicted that the UK will not suffer a double-dip and that growth this year will be 0.9% followed by 2% in 2013.
The CBI’s regular economic forecast says that companies are beginning to invest in equipment and looking for new export markets. It thinks the manufacturing sector will grow as exporters buy new equipment. It also believes that we will avoid two consecutive quarters of declining output by reversing Q4’s 0.2% fall.
However, the results of a survey from BDO suggests that turnover is still falling and that is an indication that a recession will follow. Furthermore, the CIPD has discovered that employers are feeling more inclined to make redundancies.
The BDO survey, which investigates company turnover, discovered that it has now decreased for eight consecutive months. In addition, the output index fell by 0.2 points to 91.2 in January. An index reading lower than 95 indicates contraction.
The CIPD questioned 1,000 employers for its survey and said the difference between the amount of employers planning to reduce their headcount and those intending to hire had increased to its highest level in more than two years.
The Institute’s public policy advisor, Gerwyn Davies, said employers were adopting a wait and see attitude three months ago, but now several services firms in the private sector have decided to make redundancies. The CIPD warned that we could see unemployment reach 2.85 million if economic conditions do not improve.
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Image: Up & Down. by andreasdantz
