The UK is on the brink of a technical recession according to the British Chambers of Commerce (BCC), which is predicting a significant hike in unemployment rising to over 2 million.
According to the BCC’s quarterly economic forecast, the jobless count is likely to increase by 250,000 to 300,000 over the next two to three years as the UK faces the very real possibility of a technical recession.
Of the findings, BCC director general David Frost commented: “Our quarterly economic forecast highlights a significant worsening in UK economic prospects. There is now a distinct possibility of technical recession. The level of UK unemployment is likely to increase by nearly 300,000 over the next few years, reaching almost 2 million. An increase above 2 million cannot be ruled out.”
The news echoes official figures released last week from the Office of National Statistics (ONS), which showed unemployment to be climbing. Total jobless figures have reached 1.67 million whilst the claimant count measure of unemployment rose by 20,100 in July, reaching 864,700 – the largest increase in a single month since 1992.
Commenting on the ONS figures, John Philpott, chief economist at the Chartered Institute of Personnel and Development said: “This is the weakest set of labour market data since the economic slowdown began. Employment growth has ebbed to a trickle – indeed employment has fallen in several regions of the country – while the rise in unemployment is gaining worrying momentum. The number of unemployed people claiming Jobseekers’ Allowance has risen in every month since January – with each monthly increase greater than the last – and there are now more people in receipt of this welfare benefit than a year ago.”
The BCC is predicting two years of flat or negative growth – the definition of a technical recession.
