Spending cuts will delay jobs recovery says ILO

It will take five more years for the job market in many countries to return to pre-recession levels, according to the International Labour Organisation.

The UN body says there are 23 million fewer jobs now than there were at the start of 2008.

It has warned that the spending cuts which have replaced stimulus measures in several countries will delay a full recovery in the job market until 2015.

The ILO studied the employment data of 69 developed and developing nations.

Deep Cuts

In its annual World of Work Report, the agency said that despite “significant gains” with economic growth, “new clouds have emerged on the employment horizon and the prospects have worsened significantly in many countries”.

Several European nations are implementing cuts in public spending in an attempt to rein in their budget deficits, which have risen because of falling tax revenues, stimulus spending and bank bailouts.

“Those policies that helped countries avoid the worst of the crisis are now withdrawn, and countries have applied very deep cuts in spending,” report author Raymond Torres told the BBC World Service.

“That, of course, is having an impact on jobs”.

‘Risks of demoralisation’

Around 40% of jobseekers have been without work for more than one year, the report says, running “significant risks of demoralization, loss of self-esteem and mental health problems”.

The ILO has recommended “active labour market policies”, such as focusing on vulnerable groups, particularly the young. It also suggests countries make better use of savings to spur productivity and job creation.

The report also notes that 25 countries have so far experienced social unrest since the financial crisis, including emerging economies.

The ILO predicts that global unemployment will be 6.5% this year, a slight fall from 6.6% in 2009.

Source: http://www.bbc.co.uk/news/business-11454455

UK tourist industry eyes emerging markets

The number of tourists visiting the UK from emerging nations such as Brazil, Russia, India and China is set to rise sharply, a report by VisitBritain says.

It predicted that by 2014, visitor numbers from China alone would increase by almost 100,000 – a 90% jump.

This was partly due to the popularity of Premier League football in China, it added.

However, the bulk of people visiting the UK will still come from traditional European and North American markets.

The report also looked at reasons why tourists chose the UK as a holiday destination. This included relaxing “well-being” breaks, the opportunity to visit a range of galleries and museums, and sampling traditional British pubs.

It said travellers had moved away from wanting a service towards wanting an “experience”, saying they would choose their holiday on the basis of how real or authentic it felt.

Olympic Boost

The numbers of visitors from emerging nations remain small. Between Brazil, Russia, India and China there were 650,000 visitors in the UK last year- this compares with 3.8 million from France alone.

Between them, France, the Irish Republic, The US, Germany and Spain are expected to send an extra 3.3 million new visitors by 2014.

However, tourist chiefs are looking to new markets after 2009 saw 1.2 million fewer American visitors than in the record year of 2000.

And in the first seven months of this year, tourist numbers  from North America were down by 6% on the same period a year ago.

The relative weakness of the dollar against the pound, and the sluggish recovery of the US economy, are believed to be factors in the falling numbers.

VisitBritan forecasts the number of visitors from India will grow by 29% by 2014, with more an 100,000 extra visits. Russian tourist numbers are predicted to rise by 24% with Brazilian visitors set to increase by 32%

The chief executive of VisitBritan, Sandie  Dawe, said the 2012 Olympics and Paralympic games offered a ‘once in a lifetime boost’ to the tourist industry.

She added: ‘The challenge for Britain is that competetion is getting tougher every year and we are not immune (but)… I am confident that we will come through the challenges ahead’.

Source: http://www.bbc.co.uk/news/business-11282294

Oil price drops on recovery fears

The price of oil has dropped to below $72 a barrel, its lowest level in more than two months, on renewed fears about the strength of the global recovery.

US light crude fell by $1.4, or 2%, to $71.66 a barrel, while London Brent dropped by the same amount to $72.26, after disappointing US home sales data.

Figures showed that existing home sales fell by 27% in July compared with the previous month, to a 10-year low.

The figures also pushed shares on Wall Street lower.

The main Dow Jones index closed down 134 points, or 1.3% at 10,045.

‘Continued pressure’

The weak housing sales figures fuelled concerns about the strength of the recovery of the world’s biggest economy.

They follow weak jobs market data and worse-than-expected retail sales figures released earlier this month in the US.

These have caused investors to question the strength of demand for oil going forward – the price of oil has now fallen by more than $10 a barrel this month.

“The shaky global economy continues to put pressure on crude prices,” said Victor Shum at Purvin and Gertz energy consultants.

Source: http://www.bbc.co.uk/news/business-11078345

Greek economy shrinks a further 1.5%

Greek have undergone a very down-turning year… economic recession, shrinking economy, debts and rescuing.

An article from BBC News.

The Greek economy shrank by a further 1.5% in the second quarter of the year, Greece’s statistics agency has said.

That adds to 0.8% decline in GDP recorded for the first three months of the year, suggesting that the decline in the economy is speeding up.

Greece’s GDP has fallen 3.5% since this time last year.

The country has been forced to bring in severe public spending cuts since it sparked a Europe-wide debt crisis earlier this year.

Greece’s statistics agency Elstat said the “significant reduction” in public spending had contributed to the deepening of the country’s recession.

Economists said they were not surprised by figures, and blamed the “uncertainty” surrounding the government’s austerity measures for the falls in GDP.

“Economic activity seems to be declining at an accelerated pace due to high uncertainty and the gradual implementation of austerity measures,” observed Nikos Magginas, senior economist at the National Bank of Greece.

The total decline in GDP during 2010 is forecast to hit 4%, according to the European Union and the International Monetary Fund.

A raft of austerity measures has been announced by Greece since December last year.

They include a pay freeze for public sector workers and reform to the tax and pensions systems.

(http://www.bbc.co.uk/news/business-10951857)