The Office for National Statistics announced yesterday what we all feared. That UK unemployment had increased to 7.6%, the highest in more than 10 years in the three months to May.

The jobless rate rose during that period by a record 281,000 to 2.38 million while the number of people claiming unemployment benefit increased by 23,800 in June to reach 1.56 million, less than analysts had forecast.

Unfortunately unemployment among young people continues to be especially acute, as employers are forced to restrict new starts to reduce costs during the continuing recession.

After recently acquiring the UK assets of Tiscali, the Italian telecoms company, the telecommunications division of Carphone Warehouse are reputedly examining the feasibility of becoming a television operator.

According to a statement from Charles Dunstone, Carphone’s chief executive, the company was studying whether their Talk -Talk phone and broadband business should expand Tiscali’s TV service.

Carphone completed their £236 million takeover deal for Tiscali, the Milan-listed telecoms company UK assets just last week. Included in the deal was Tiscali TV, a service that provides customers with Freeview channels and video-on-demand content.

The deal meant that as well as being Europe’s largest mobile phone retailer Carphone is now Britain’s second-largest broadband provider, only six years after the company launched their consumer fixed-line telecoms business.

On the FTSE the U.K.’s second-largest clothing retailer Next rose BY 3.5 percent to 1,667 pence on favourable analyst reports.

Meanwhile shares in the U.K.’s largest retailer of outdoor clothing and equipment Blacks Leisure Group Plc dropped by one percent to 49 pence despite their announcement that they were engaged in advanced talks to renew its existing working capital facility with Lloyds Banking Group Plc.

The FTSE 100’s recovery is gaining pace daily. Yesterday the guide increased by another 108.78 points to 4346.46. The FTSE 250 also continues its meteoric rise, jumping yesterday by 161.24 points to 7,572.33

The pound gained further ground on Wednesday against the dollar and the yen, whilst dropping against the Euro.

Pound/US dollar 1.642
Pound/Euro 1.1654
Pound/Japanese Yen 154.9105
Pound/Swiss Franc 1.7766

According to a report from the US Federal Reserve the US economy will continue to sink in 2009, but at a slower pace than previously estimated
Growth forecast for 2010 and 2011 were also increased.

However there are strong warnings that unemployment in the United States would reach 10%, is higher than earlier predictions.

Despite efforts to the contrary, US consumer prices rose in June at their fastest pace for nearly a year, prompted by higher petrol prices, according to a report from the US Department of Commerce.

The Consumer Price Index jumped by 0.7% last month, a shock after May’s conservative raise of 0.1%, and higher than the 0.6% increase analysts had predicted. The principal factor was the 17.5% increase in petrol prices.

Outside influences seem to play no part of what is going on Wall Street these last few days. There was no holding back the Dow Jones index as it rose by 256.72 points to 8616, 21 while the NASDAQ continued to scale the heights shattering the 1800 barrier to close on 1862.19 after a daily increase of 63.17 points.

Troubled US banking group, Citigroup is reportedly close to securing a confidential agreement with one of its main regulators. The agreement is designed to increase scrutiny within the bank and force it to repair financial, managerial and governance issues.

The deal has seemingly been discussed in recent weeks amid increased pressure on Citi from the Federal Deposit Insurance Corporation, and is expected be finalised in the near future.

China’s foreign exchange reserves, the world’s largest, have surpassed the $2 trillion (£1.2 trillion) mark according to a statement from the country’s central bank has said. Foreign currency reserves in the country have raised by a staggering 17.8% since June 2008 to a reach a record $2.13 trillion, making their currency holdings twice that of Japan who is the second largest holders of foreign currency in the World.

Commodity markets extended their advance helped by the dollar’s continuing weakness. Crude oil prices began to rise in advance of the latest US weekly inventories data gold climbed towards the $930 level

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Tags: Economy, Employment, Financial News, Office for National Statistics, Stock Markets, UK Recession, UK unemployment figures, Unemployment

A scheme developed by the Confederation for British Industry (CBI) as an “alternative to redundancy” could stem job losses as UK unemployment figures hurtle headlong heads towards three million.

The CBI is urging the government to adopt their plan that is aimed mainly at companies that are feeling the effects of long term cash flow problems and may have difficulty in meeting their wage bill.

According the scheme, employees who were due to be made redundant , instead would take a form of unpaid holiday for up to six months, during which time they would be paid a weekly allowance, amounting to double of what the officially unemployed would receive with the payment co-funded by government and employers. During their unpaid leave, employees would be allowed to seek alternative employment and the company could exercise their option take them back when the six months ended or even earlier if business or cash flow improved.

Prime Minister Gordon Brown will be carrying a not too optimistic message with him when he attends the G8 summit to be held in Italy later this week. The message will state that excitement over the fledgling recovery of the global economy may have been premature. In a recent interview, Brown stated that the summit to be held in the picturesque setting of ’Aquila should be “a second wake-up call for the world economy According to a recent report that paints a cautious picture of the economic outlook, UK banks continue to increase investing in managing risk even as they look to make drastic cost cutting efforts.

The report also states that the majority of UK financial services companies do not expect to return to a growth situation for at least another nine months to a year, and are dug into a form of survival mode. Any investments being made are in risk controlling apparatus, whilst the one- time favourites, information technology and supply chain management are being put on the back burner for the foreseeable future.

Despite the introduction of the UK smoking ban, tax hikes and the overall state of the economy, bingo and casino operators Rank Group, remains optimistic about future. The company has stated their intention to convert some of their provincial casinos and bingo halls into modern leisure complexes, capable of competing against cinemas, pubs and restaurants. Some projects already under way include a new five million pound Mecca Bingo centre in Beeston and a Casino in Dundee.

French based water and environmental services company Veolia seem likely to put its UK water division up for sale to raise money to reduce debt.
Veolia who supply water to more than 3.3 million customers in the South East of England reportedly hope to raise around 400 million pounds million for a 48 percent stake in the group.

On the FTSE yesterday food makers proved the resilient forces with persistent talk of takeover interest in Cadbury saw their shares rise 1.8 percent to 527 pence, while SSL International also rose by 3.1 percent to 526 pence.

Manufactures of consumer goods were the investor’s favourites, as the commodity market continued to lose pace. Reckitt Benckiser was the day’s top performer, gaining 2.5 per cent to 2757 pence. The tobacco giants did well with Imperial Tobacco rising 1.5 per cent higher at 291 pence and British American Tobacco also rose by 1.8 per cent to close on 1741 pence.

The FTSE 100 Index dropped 41.37 points on the day’s trading close on 4,194.91. Also down was the FTSE 250, this time by 56.63 points as it closed on 7.320.35.

Sterling made a minor recovery against the leading currencies.

Pound/US dollar 1.6248
Pound/Euro 1.1632
Pound/Japanese Yen 154.8935
Pound/Swiss Franc 1.7649

Following its tie-up with Merrill Lynch, the Bank of America has become the world’s largest wealth manager overtaking UBS in the private banking league tables
BOA currently oversees more than $1,500 billion in assets, most of them in the US, underlining the scale the bank acquired from the Merrill Lynch merger.
A late rally on Wall Street turned US equities positive on Monday following the previous session’s heavy falls.

The index closed at the end of the day up a token 4.15 points to 8284.89, while the NASDAQ closed again down for the day, this time by 18.13 points on 1778.39

Oil prices are hovering at a five-week low of about $64 a barrel, amid fears that the global recovery looks like taking longer than thought a few weeks ago.
US crude fell $2.27 dollars to $64.46 a barrel in afternoon trade on Monday, after having dipped to $63.85, the lowest intraday price recorded since 28 May.
Brent crude oil also declined by $1.27 a barrel to $64.34

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Tags: Bank of America, British Economy, CBI, Financial News, G8 summit, Gordon Brown, Rank Group, UK unemployment figures

Recent research has shown that the UK’s unemployed and unemployable still appear to focus both geographically and socially on the country’s most deprived areas. Fears in government circles are that this trend is likely continue into a viscous circle, seriously threatening to undermine the government’s recent drive against poverty.

Data gathered since the recession was officially declared at the beginning of the year presents a worrying picture, indicating that the effects of unemployment is focusing on unskilled low-income workers in the Midlands and the north of England.

Any signs of to growth nationally in both manufacturing and services are only being shown in regions and socio-economic sectors of the UK population who fall into neither of these categories, a viscous circle that seems likely o continue for the foreseeable future. When looking at an overall picture, the most deprived areas of the UK continue to show disproportionately higher increases in unemployment, with 580 per cent increases in new claimants than from the same period last year.

Unemployment in the UK, currently sitting at around two and quarter million is forecasted to continue to rise for several months, and may even reach three million by the end of this year

Officials from the Trades Union Congress (TUC) are facing the situation with considerable concern with Brendan Barber, the TUC’s general secretary predicting that even when the economy begins to recover, it would take years before the unskilled or semi-skilled jobless would begin to feel any benefit.

Barber emphasized “Tackling unemployment must remain the government’s number one priority,” “Getting people back into work and into jobs with decent pay will not only benefit the more than two million people currently out of work but also the economy , by generating the spending boost it needs.”

The heaviest concentrations of deprivation tend to be in the north – particularly the north-east – although levels of unemployment in London remains substantial, although a closer look at the statistics show that the highest levels can be found in the traditional poorer districts of the capital Liverpool bears the unwelcome distinction of being the city with the highest average levels of unemployment and poverty.

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Tags: Employment, TUC, UK unemployment figures, Unemployment

Figures released by the Office for National Statistics show that unemployment levels are rising as fast as they did in the recession n of the early 1980s, and even faster than that of the early 1990s. Unemployment figures show that the number of UK residents who are claiming benefit rose by 1.3 percent to 7.1 per cent in the last quarter.
Barclays Bank continues to impress, by announcing that they are in talks with several companies about selling their asset management arm Barclays Global Investors (BGI). The bank hope to bring in around for about $10billion for the sale, with US money manager BlackRock apparently keen to conclude the purchase. Barclay’s cash raising move comes on the heels of their sale at auction of iShares, BGI’s exchange-traded funds unit to buyout group CVC for $4.2billion last month.

It might have been a coincidence but Barclays was among the top performers yesterday on the FTSE, up 4.2 percent (0 pence to 253) Standard Chartered was up 8.1 per cent (95 pence to 1197) and the Royal Bank of Scotland also added 4 per cent (1.6 pence to 39.5)

A spokesman for the National Grid announced yesterday that that company expects to strengthen its financial position this year, despite the fact that they are planning a further £1billion debt to fund a necessary investment programme.

The FTSE 250 index rose by 43.56 points to close on 7,472.33
While the FTSE 100 finished the session up 13 points, higher at 4,375.58
Sterling fell slightly against the dollar and rose against the strengthening Euro as well as the Japanese Yen and the Swiss Franc:

· Pound/US dollar 1.5235

· Pound/Euro 1.1198

· Pound/Japanese Yen 145.03

· Pound/Swiss Franc 1.6844

US equities broke their losing streak on Thursday following three consecutive days of selling as investors shrugged off negative unemployment data and took encouragement from the retail sector, allowing for a mixed day on trading on Wall Street
The Dow Jones Average rose 46.43 points to close at 8331.32. Nasdaq did well rising 25.02 points to 1689.21

The Obama administration is expected to roll out the next phase of its financial rescue plan any day now. The phase is scheduled to deal with toxic “legacy assets”, with senior administration officials keen to discover new private/public marketplaces for these bubble-era loans and securities. Their hope is by doing so banks can clean up their balance sheets and attract the almost £49 billion in equity they need to meet their stress test targets.
Sports clothing giant, Nike has announced their intention to cut about 1,750 jobs, making for the largest headcount reduction in its history, amounting to about 5% of Nike’s 35,000 global workforces. Nike is striving to cut costs after a recent sales decline due to the economic downturn, particularly in Europe.

It was announced yesterday that the German economy has suffered its largest contraction for the first quarter of 2009 since reunification/
Gross domestic product (GDP) dropped by 3.8% from the previous quarter, due to sharp falls in exports and investment. The French economy fared a little better for the same period down 1.2%

The Spanish economy also shrank, this time by 1.8% for the same quarter, making it the highest rate of decline for nearly 40 years.
In Asia, Toyota Motors, still reeling from their first loss making year in history, announced their plans for one of the most drastic management overhauls in its 70-year history. The ball is expected to begin rolling next month Akio Toyoda, grandson of the company’s founder, takes over at the helm as chief executive of the Japanese car maker.

The company intend to replace almost half of their senior managers as well as reorganising its key North American business.
After a few days of rises, crude oil prices fell yesterday after the International Energy Agency (IEA) said global demand would shrink by 2.56m barrels a day to 83.2m in 2009.
The IEA said eight out of the world’s 10 largest oil consuming countries were likely to see a “marked fall” in oil demand as their economies slowed or contracted. Despite that gloomy forecast, crude prices actually rose around 10 cents a barrel to average $58.69.
Gold was down $2.00 an ounce at $926.40, while copper also fell to $203.50

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Tags: Barclays, Barclays Global Investors, Dow Jones, Employment, FTSE, Obama, Toxic Debt, UK unemployment figures

Despite forecasts to the contrary, recent figures show that unemployment in the major cities of the UK are much higher than that of London, the capital city, on a percentage basis. The figures make for some interesting reading, especially as estimates on future job losses were based on the general assumption that with the virtual collapse of the largely London based financial services industry, the city would be the hardest hot.

Yet the figures show different, with Birmingham, the industrial capital of the UK being the hardest hit, with unemployment levels rising from 5% of the potential work force to 7.3% making for an increase of 12,383 job losses (33,274 in February 2008 to 45,657 in February 2009.

Other major industrial centres suffered from similar percentage downturns in unemployment, according to the list below:

Hull: Increase from 4.8% to 8% from corresponding month in 2008 (from 8,062 to 13,366)
Liverpool: Increase from 5.3% to 7% from corresponding month in 2008 (from 15,208 to 20,055)
Glasgow: Increase from 3.7% to 5.2% from corresponding month in 2008 (from 14,403 to 20,276)
Manchester: Increase from 3.4% to 5.1% from corresponding month in 2008 (from10,836 to 16,069)
Bradford: Increase from 3% to 4.7% from corresponding month in 2008 (from 9,242 to 14,321)
Leeds: Increase from 2.5% to 4.3% from corresponding month in 2008 (12,628 to 21,558)
Sheffield: Increase from 2.5% to 4.1% from corresponding month in 2008 (from 8,463 to 14,017)
Bristol: Increase from 1.8% to 3.5% from corresponding month in 2008 (from 5,057 to 9,771 )

The figures show that unemployment continues to be focused in the north of the country, and especially in geographical regions and sectors of the economy which had always been hardest hit even in times of plenty.

Even after the economy begins to turn around, the future will continue to look bleak in the traditional manufacturing and heavy industry sectors, experts say.

Hopes are that Alasdair Darling will address these issues in his forthcoming budget, and set aside a portion of his economic stimulus cake on creating innovative and long term solutions for the chronic unemployment issues that has pervaded the major Northern population centres through good times and bad.

Currently the unemployment figures give little cause for encouragement, with the number of those joining the jobless queue increasing by 165,000 to 2.03 million, according to figures issued by the Office for National Statistics (ONS).

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Tags: Credit Crunch, Employment, Finance, Financial News, Recession, UK Banks, UK Recession, UK unemployment figures

Figures to be announced later today are expected to show that UK unemployment figures are expected to rise by around 85,000 in December, 10,000 more than the previous month. These less than encouraging figures continue to point to projections that unemployment figures of three and a quarter million by the end of 2010 may well be accurate.

Despite the UK government’s sterling attempts to re-inflate the economy, firms are looking to reduce their overheads as much as possible to ride out the recession. One way they are looking to achieve their goal is to cut their staff back to the minimum. The government’s hope that Monday’s injection of finance to banks will allow them to ease their lending restrictions and in turn allow UK companies to hang on to as many trained staff as possible.

Analysis of current unemployment figures continue to show that the number of women being made redundant is almost twice as many as men in the workforce.

This statistic is particularly worrying as increasingly more families are becoming dependant on joint salaries. The sectors particularly hard hit were in leisure and entertainment as well as retailing, where the higher percentage of job holders is women. One encouraging note in favour of equality in the workplace is that in one in five of families where both partners are wage earners, the female earns more than the male.

TUC general secretary Brendan Barber urged the government to take specific measures to ensure unemployed women received the support they needed to get back into work.

Women’s employment has increased significantly over the past 30 years, while it has fallen for men, according to the research.

Meanwhile, a separate study by the Chartered Institute of Personnel and Development showed employers were shedding temporary or agency workers.

Among them was luxury clothing retailer Burberry who announced they would be cutting 290 jobs cutting their overheads by an annual 35 million pounds?

One the retailing front, the toy retailing group Argos has announced that they have purchased the rights to the Chad Valley brand of toys from Woolworth’s administrator Deloitte, paying five million pounds in cash. Argos, the UK’s largest toy retailer is reluctant to see the Chad Valley name disappear into history. Company marketing experts claimed that Chad Valley was part of a very strong heritage that would ideally complement Argos’s image in the toy marketplace.

On Monday Woolworths Group also announced that talks regarding the sale of its stake in its DVD publishing joint venture with BBC Worldwide (regarding the sale of 2Entertain) were still ongoing.

On the retail clothing front, fashion retailer Primark announced that they had overtaken Asda as the UK’s leading low-price clothing retailer. According to a recent report Primark), increased its market share from 16.5 percent to an estimated 17.7 percent during 2008. While Asda only succeeded in increasing its market share from 16.9 percent to an estimated 16.94 percent.

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Tags: Recession, Retail, UK Recession, UK unemployment figures, Unemployment