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Tuesday, 7 August, 2001, 12:37 GMT 13:37 UK
CBI: Manufacturers' woe worsens
Containers being loaded
Optimism about export prospects is continuing to fall
UK manufacturers think more job losses are on the way as export prospects for the sector get worse.

That is according to the latest Regional Trends Survey published by the Confederation of British Industry (CBI).

The survey found optimism about export prospects has fallen at its quickest rate for almost 3 years.

The worsening outlook means the CBI is predicting a further 29,000 manufacturing jobs will be lost between July and September this year.

Job losses spread

The job cuts are expected to be spread across all regions of the UK, with only the South West of England and Northern Ireland escaping.

The survey found the manufacturing slump has become more widespread across the UK.

In the previous four months there were big job cuts in the North East, East Midlands, North West and Yorkshire and Humberside.

But now job losses are rising in the South East, East of England and West Midlands. Scotland also reported its worse level for two years.

The news comes just a day after official figures showed the UK's manufacturing sector had fallen into recession.

Another rate cut needed?

The CBI's Sudhir Junankar said the figures showed the Bank of England's surprise decision to cut interest rates last week was correct, and that more action may be needed.

"The global slowdown is now hitting UK manufacturing hard with firms in virtually all UK regions experiencing falling orders, output and employment with severe pressure on profits margins," he said.

"With underlying inflation set to remain within the government's 2.5% target, further interest rate reductions may be necessary if consumer demand comes off the boil and service sector growth eases further," he added.

See also:

06 Aug 01 | Business
UK manufacturing in recession
06 Aug 01 | Business
Q&A: The manufacturing recession
03 Aug 01 | Business
Gloom spreads to UK service sector
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