CIPD: Rate rise will bring job cuts


The Chartered Institute of Personnel Development has warned interest rate rises will lead to further job losses.

Its mid-year assessment of the UK employment market suggested its earlier cautionary forecasts were accurate. However, there remained a possibility unemployment would again surge, has reported.

Chief economist, John Philpott, told the site "a rate hike would be a cause of major concern", and explained the CIPD forecast was based on rates falling.

"Many employers have their finger on the redundancy trigger," he warned. "They are not yet ready to start firing but a rise in interest rates would probably be enough to cause a substantial jobs cull come the autumn."

The economy is now feeling the full force of the credit crunch. Initially, it was the commercial property markets that were squeezed – now retail and manufacturing industries are also struggling.

More than 11,000 jobs are now in question following the US government’s decision to allow Boeing to bid for a contract it had already awarded to European avionics firm, Airbus, it has been reported.