Britain's official unemployment rate hit the highest level for about 10 years on Wednesday, as experts warned more job cuts would come as the recession deepens.
Although the figures were not so bad as some experts had expected, falling short of the symbolic two million barrier, analysts warned that the figure could hit 3.5 million by the end of next year as the effects of the slowdown filter through.
Protests fuelled by the rising threat of unemployment -- underlined by almost daily job cut announcements -- have snowballed in recent weeks, including a new power plant walkout on Wednesday following wildcat strikes last week.
The percentage of Britons out of work jumped to 1.97 million or 6.3 percent in the three months to December, a rise of 0.2 percent, according to figures from the Office for National Statistics (ONS).
"For every person who is made unemployed, there is a sadness and sorrow and we will do what we can to help people back to work as quickly as possible," Prime Minister Gordon Brown said after the figures came out.
His official spokesman told reporters: "Every job loss is obviously a matter of regret and disappointment."
Brown met 22 business leaders from some of Britain's biggest companies like supermarket chain Tesco and energy firm Centrica at his Downing Street office Wednesday to discuss getting more people into work.
But some observers warned the picture on unemployment looked set to get worse.
The general secretary of the TUC (Trades Union Congress) Brendan Barber said the situation was a "national emergency", adding: "This is another set of dreadful figures and we fear worse is still to come."
Vicky Redwood, an analyst from research consultancy Capital Economics, said the figures did not fully reflect the effects of a major contraction in the fourth quarter of 2008.
"We still think unemployment will reach 3.5 million by the end of 2010," she added.
Unemployment in Britain is lower than in some other European countries -- Germany, Europe's largest economy, has 8.3 percent unemployment and the figure in France stands at around eight percent.
But the global downturn looks set to hit Britain harder than its European neighbours -- the International Monetary Foundation (IMF) said last month that it would suffer worse than any other developed country.
Official figures last month confirmed that Britain was now in recession, while Brown last week used the word "depression" to describe the situation.
Education Secretary Ed Balls, Brown's former economic advisor and one of his closest allies, said this week Britain was facing the worst recession for 100 years.
New job cuts have hit the headlines almost daily in recent weeks -- carmakers like Bentley, Nissan and Jaguar have announced major cuts along with Royal Bank of Scotland (RBS), which is now majority state-owned.
Workers at London Underground were due to stage a demonstration Wednesday against what unions say are plans to cut up to 2,500 jobs on top of 1,000 already announced.
Meanwhile, hundreds of construction staff at the Staythorpe power station in central England walked out Wednesday after being told they faced disciplinary action if they joined a protest over the use of foreign contractors.
Last week, thousands of workers around Britain joined wildcat strikes on the issue.
Wednesday's unemployment figures were calculated using the International Labour Organisation (ILO) measure of unemployment.
Agencies
Thursday, February 12, 2009
6,000 workers lose jobs everyday in Mexico
Nearly 6,000 workers lose their jobs daily, which has been happening since November 1, 2008, a report of the Mexico Social Welfare Institute (IMSS) has revealed.
Updated statistics that recently reported an increasing unemployment rate in the last quarter of 2008 of half a million jobs, now pointed out that a higher figure remained in the period of November-January.
The research indicated that only in the big cities 128,122 jobs have been lost last January while the current world economic crisis also had a deep impact on this field, mainly for casual day labourers.
According to the source the company that left more quantity of jobless was CEMEX, considered one of the most important cement producing company of the world, cutting 18,786 jobs.
Agencies
Updated statistics that recently reported an increasing unemployment rate in the last quarter of 2008 of half a million jobs, now pointed out that a higher figure remained in the period of November-January.
The research indicated that only in the big cities 128,122 jobs have been lost last January while the current world economic crisis also had a deep impact on this field, mainly for casual day labourers.
According to the source the company that left more quantity of jobless was CEMEX, considered one of the most important cement producing company of the world, cutting 18,786 jobs.
Agencies
Will General Motors layoff 10,000 salaried jobs?
General Motors Corp. said on Tuesday it will cut 10,000 salaried jobs, citing the need to restructure itself with a government deadline looming and amid some of the worst sales in the auto industry's history.
The Detroit-based automaker said it will reduce its total number of salaried workers to 63,000 from 73,000 this year. About 3,400 of GM's 29,500 salaried U.S. jobs are expected to be eliminated.
The company's statement said that the separations would be done through GM's severance plan, so there would be no buyout or early retirement packages as GM had offered in the past.
In its plan to Congress submitted late last year, GM said work force reductions would be necessary in order for it to be viable for the long term. Most of the cuts are expected to take place by May 1.
GM said the cuts will vary by global regions depending on staffing levels and market conditions.
In addition, GM said it will cut the pay of most of its salaried U.S. workers beginning May 1 and continuing at least through the end of the year at which time the pay cuts will be evaluated.
The pay of U.S. executive employees will be cut by 10 percent, while other salaried workers will see cuts of 3 percent to 7 percent, GM said.
GM faces a Feb. 17 deadline to present to the government a plan showing it can become viable. The plan is required by the terms of $9.4 billion in low-interest government loans to the wounded automaker, which is seeking another $4 billion from the Treasury Department.
The automaker is negotiating with bondholders and the United Auto Workers union for concessions and it is planning to close several factories. To prove its viability, it must show an ability to repay the loans and prove "positive net present value."
Agencies
The Detroit-based automaker said it will reduce its total number of salaried workers to 63,000 from 73,000 this year. About 3,400 of GM's 29,500 salaried U.S. jobs are expected to be eliminated.
The company's statement said that the separations would be done through GM's severance plan, so there would be no buyout or early retirement packages as GM had offered in the past.
In its plan to Congress submitted late last year, GM said work force reductions would be necessary in order for it to be viable for the long term. Most of the cuts are expected to take place by May 1.
GM said the cuts will vary by global regions depending on staffing levels and market conditions.
In addition, GM said it will cut the pay of most of its salaried U.S. workers beginning May 1 and continuing at least through the end of the year at which time the pay cuts will be evaluated.
The pay of U.S. executive employees will be cut by 10 percent, while other salaried workers will see cuts of 3 percent to 7 percent, GM said.
GM faces a Feb. 17 deadline to present to the government a plan showing it can become viable. The plan is required by the terms of $9.4 billion in low-interest government loans to the wounded automaker, which is seeking another $4 billion from the Treasury Department.
The automaker is negotiating with bondholders and the United Auto Workers union for concessions and it is planning to close several factories. To prove its viability, it must show an ability to repay the loans and prove "positive net present value."
Agencies
Wednesday, February 11, 2009
India remains the kings of outsourcing business
Though the world is witnessing a severe meltdown, IT firms in India found it an opportunity to step up their outsourcing activities as global companies are resorting to several cost cutting initiatives. It is despite the fact that the country is facing serious threats to its outsourcing leadership from a few internal elements like vulnerabilities to terror attacks and erosion of the confidence in corporate governance.
However India will remain a major outsourcing destination. "Even though other markets will be redoubling efforts to seize opportunities from India, no other country yet presents a serious threat as a key outsourcing destination", said Arno Franz, Partner and Asia-Pacific President at TPI, while speaking to BusinessWeek. "China is still very much an emerging destination, while it is debatable whether any other single country has the breadth and depth of skills, experience and infrastructure to seriously challenge India's position," he added.
Franz pointed out that India-based providers made significant market share increases last year. In terms of total contract value (TCV), Indian outsourcers contributed 16 percent of the global market, up from 11 percent in 2007. They also accounted for over half of the Asia-Pacific outsourcing TCV. Moreover, two out of the three mega-deals in the second half of 2008 went to India-based providers. Mega deals, defined by TPI as contracts worth over $1 billion, numbered 12 between January and June last year.
Over the year, there was a record of 88 contracts in the region with a total contract value of over US$25 million, 50 of which were awarded in the second half. Despite the high number, the 2008 TCV of Asia-Pacific outsourcing deals was $12.3 billion, lower than 2007's $12.7 billion. Annualized contract value (ACV), which is the contract value divided by its duration, also fell from $2.7 billion in 2007, to $2.4 billion last year.
Agencies
However India will remain a major outsourcing destination. "Even though other markets will be redoubling efforts to seize opportunities from India, no other country yet presents a serious threat as a key outsourcing destination", said Arno Franz, Partner and Asia-Pacific President at TPI, while speaking to BusinessWeek. "China is still very much an emerging destination, while it is debatable whether any other single country has the breadth and depth of skills, experience and infrastructure to seriously challenge India's position," he added.
Franz pointed out that India-based providers made significant market share increases last year. In terms of total contract value (TCV), Indian outsourcers contributed 16 percent of the global market, up from 11 percent in 2007. They also accounted for over half of the Asia-Pacific outsourcing TCV. Moreover, two out of the three mega-deals in the second half of 2008 went to India-based providers. Mega deals, defined by TPI as contracts worth over $1 billion, numbered 12 between January and June last year.
Over the year, there was a record of 88 contracts in the region with a total contract value of over US$25 million, 50 of which were awarded in the second half. Despite the high number, the 2008 TCV of Asia-Pacific outsourcing deals was $12.3 billion, lower than 2007's $12.7 billion. Annualized contract value (ACV), which is the contract value divided by its duration, also fell from $2.7 billion in 2007, to $2.4 billion last year.
Agencies
Intel invests big in US; Just as others cut costs
Chip giant Intel is swimming against the tide. At a time when most of the companies are cutting back on their expenses in the U.S., Intel is investing massively in that country. The company on February 10 announced plans to invest $7 billion over the next two years to expand and transform three U.S. manufacturing plants. With this initiative, Intel aims to outpace rival Advanced Micro Devices (AMD) in its core PC business, reported BusinessWeek.
The company plans to begin shipping in volume the world's first microprocessors created at the atomic 32-nanometer level-transistors so small that 4 million of them could fit on the period at the end of this sentence, as early as this fall. Intel plans to begin retooling chipmaking plants in Arizona, New Mexico, and Oregon, where a total of 7,000 people will be employed.
By shifting to a more efficient manufacturing process, Intel hopes to sell chips to consumer electronics, cell phones, and other Internet-connected devices. Such chips could substantially lower development costs for Nokia (NOK), Samsung, Sony (SNE), and other manufacturers struggling to outdo each other with cutting-edge TVs, phones, and other devices.
"We're investing in America to keep Intel and our nation at the forefront of innovation," said Intel CEO Paul S. Otellini. "The chips that the new fabs produce will become the basic building blocks of the digital world, generating economic returns far beyond our industry," he added.
Intel executives had been signaling for weeks that the chipmaker remained on track to spend $5.2 billion, or roughly the same as it spent on capital improvements in 2008, to move to the 32-nanometer manufacturing process.
Agencies
The company plans to begin shipping in volume the world's first microprocessors created at the atomic 32-nanometer level-transistors so small that 4 million of them could fit on the period at the end of this sentence, as early as this fall. Intel plans to begin retooling chipmaking plants in Arizona, New Mexico, and Oregon, where a total of 7,000 people will be employed.
By shifting to a more efficient manufacturing process, Intel hopes to sell chips to consumer electronics, cell phones, and other Internet-connected devices. Such chips could substantially lower development costs for Nokia (NOK), Samsung, Sony (SNE), and other manufacturers struggling to outdo each other with cutting-edge TVs, phones, and other devices.
"We're investing in America to keep Intel and our nation at the forefront of innovation," said Intel CEO Paul S. Otellini. "The chips that the new fabs produce will become the basic building blocks of the digital world, generating economic returns far beyond our industry," he added.
Intel executives had been signaling for weeks that the chipmaker remained on track to spend $5.2 billion, or roughly the same as it spent on capital improvements in 2008, to move to the 32-nanometer manufacturing process.
Agencies
Tuesday, February 10, 2009
US Financial bailout may top $1 trillion
The Obama administration said Tuesday its new plan for rescuing America's crippled banking and financial sectors could top $1 trillion in a complex formula of cash infusions from government and the private sector.
Treasury Secretary Timothy Geithner revealed the massive rescue effort just hours after President Barack Obama said at his first White House news conference that Congress risked turning ``a crisis into a catastrophe'' if it fails to approve a separate $800-plus billion economic stimulus program. The plan has faced stiff opposition from Republican lawmakers.
The new financial bailout plan brought forward by Geithner grows out of a $700 billion rescue program put in place in October, under the Bush administration, as the depth of the country's critical financial sector troubles surfaced with a collapse of the housing market.
``Right now critical parts of our financial system are damaged,'' Geithner said in unveiling the new plan. ``Instead of catalyzing recovery, the financial system is working against recovery and that's the dangerous dynamic we need to change.''
Half of the bailout money was allocated by former President George W. Bush's administration, but that spending has come under heavy criticism for a lack of transparency and the failure of banks to put the money into the frozen credit market.
The second half of the $700 billion is now in the hands of the Obama administration, which plans to greatly expand the effort to unclog credit markets that provide loans to consumers and businesses. Funding for this effort would see a huge increase from $20 billion up to $100 billion, according to administration officials.
If a total of $100 billion from the bailout fund was used, it would be enough to support an additional $1 trillion in lending support through a Federal Reserve program that was announced in November but has yet to begin operations.
The administration also announced that the program would be expanded beyond consumer and small business loans to provide aid to the troubled commercial real estate sector.
The administration also announced a program to create a partnership between the government and the private sector to get private investors to buy bad assets that are currently weighing down the balance sheets of banks. Congressional aides who were briefed on this plan said that Treasury officials said it could involve between $250 billion and $500 billion in government support.
As Geithner put forward the new bailout package, the Senate, despite nearly unanimous Republican opposition, was expected to approve a $838 billion stimulus bill later Tuesday. Senate approval would set the stage for possibly contentious negotiations with the House on a final compromise on legislation. Congressional leaders hope to get the bill to Obama's desk in a few days.
Obama defended the stimulus plan in his press conference Monday night, saying the federal government ``is the only entity left with the resources to jolt our economy back to life.''
``The plan is not perfect,'' the president said. ``No plan is. I can't tell you for sure that everything in this plan will work exactly as we hope, but I can tell you with complete confidence that a failure to act will only deepen this crisis as well as the pain felt by millions of Americans.''
Obama goes to Fort Myers, Florida, a metropolitan area among the hardest-hit by mortgage foreclosures, for another town-hall meeting Tuesday like the one he held Monday in Elkhart, Indiana, to promote his economic plan.
Just three weeks after his inauguration was celebrated jubilantly around the world, Obama has run into the jarring difficulties of governing. He failed to win over the Republicans he courted for his economic plan. Some of his supporters have wondered if he has yielded too much ground in the pursuit of bipartisanship.
Yet Obama's approval ratings remain high — 67 per cent according to a Gallup Organization poll released Monday. He is trying to tap into that popularity to win public and congressional support for his economic recovery plan as the country faces its worst economic crisis in 80 years.
``This is not your ordinary, run-of-the-mill recession,'' Obama said in his address Monday night, issuing a dire warning of the consequences if Congress fails to agree on a stimulus package. He cited Japan's failure to take bold actions in time to reverse a recession that turned the 1990s into a ``lost decade'' with no economic growth.
Despite painting a dire picture of the American economy, Obama said the US could well be in better shape by next year, as measured by increased hiring, lending, home values and other factors.
``If we get things right, then, starting next year, we can start seeing significant improvement,'' Obama said.
Agencies
Treasury Secretary Timothy Geithner revealed the massive rescue effort just hours after President Barack Obama said at his first White House news conference that Congress risked turning ``a crisis into a catastrophe'' if it fails to approve a separate $800-plus billion economic stimulus program. The plan has faced stiff opposition from Republican lawmakers.
The new financial bailout plan brought forward by Geithner grows out of a $700 billion rescue program put in place in October, under the Bush administration, as the depth of the country's critical financial sector troubles surfaced with a collapse of the housing market.
``Right now critical parts of our financial system are damaged,'' Geithner said in unveiling the new plan. ``Instead of catalyzing recovery, the financial system is working against recovery and that's the dangerous dynamic we need to change.''
Half of the bailout money was allocated by former President George W. Bush's administration, but that spending has come under heavy criticism for a lack of transparency and the failure of banks to put the money into the frozen credit market.
The second half of the $700 billion is now in the hands of the Obama administration, which plans to greatly expand the effort to unclog credit markets that provide loans to consumers and businesses. Funding for this effort would see a huge increase from $20 billion up to $100 billion, according to administration officials.
If a total of $100 billion from the bailout fund was used, it would be enough to support an additional $1 trillion in lending support through a Federal Reserve program that was announced in November but has yet to begin operations.
The administration also announced that the program would be expanded beyond consumer and small business loans to provide aid to the troubled commercial real estate sector.
The administration also announced a program to create a partnership between the government and the private sector to get private investors to buy bad assets that are currently weighing down the balance sheets of banks. Congressional aides who were briefed on this plan said that Treasury officials said it could involve between $250 billion and $500 billion in government support.
As Geithner put forward the new bailout package, the Senate, despite nearly unanimous Republican opposition, was expected to approve a $838 billion stimulus bill later Tuesday. Senate approval would set the stage for possibly contentious negotiations with the House on a final compromise on legislation. Congressional leaders hope to get the bill to Obama's desk in a few days.
Obama defended the stimulus plan in his press conference Monday night, saying the federal government ``is the only entity left with the resources to jolt our economy back to life.''
``The plan is not perfect,'' the president said. ``No plan is. I can't tell you for sure that everything in this plan will work exactly as we hope, but I can tell you with complete confidence that a failure to act will only deepen this crisis as well as the pain felt by millions of Americans.''
Obama goes to Fort Myers, Florida, a metropolitan area among the hardest-hit by mortgage foreclosures, for another town-hall meeting Tuesday like the one he held Monday in Elkhart, Indiana, to promote his economic plan.
Just three weeks after his inauguration was celebrated jubilantly around the world, Obama has run into the jarring difficulties of governing. He failed to win over the Republicans he courted for his economic plan. Some of his supporters have wondered if he has yielded too much ground in the pursuit of bipartisanship.
Yet Obama's approval ratings remain high — 67 per cent according to a Gallup Organization poll released Monday. He is trying to tap into that popularity to win public and congressional support for his economic recovery plan as the country faces its worst economic crisis in 80 years.
``This is not your ordinary, run-of-the-mill recession,'' Obama said in his address Monday night, issuing a dire warning of the consequences if Congress fails to agree on a stimulus package. He cited Japan's failure to take bold actions in time to reverse a recession that turned the 1990s into a ``lost decade'' with no economic growth.
Despite painting a dire picture of the American economy, Obama said the US could well be in better shape by next year, as measured by increased hiring, lending, home values and other factors.
``If we get things right, then, starting next year, we can start seeing significant improvement,'' Obama said.
Agencies
GM to cut 10,00 salaried jobs
General Motors says it's cutting 10,000 salaried jobs, blaming the need to restructure the company amid the continued drop in new vehicle sales.
The Detroit-based automaker says it will reduce its total number of salaried workers to 63,000 from 73,000 this year. About 3,400 of GM's 29,500 salaried US jobs are expected to be eliminated.
The job cuts are part of the restructuring plan GM submitted to Congress late last year. Most of the cuts are expected to take place by May 1.
GM says the cuts will vary by global regions depending on staffing levels and market conditions.
GM also is cutting the pay of most of its salaried U.S. workers beginning May 1 and continuing at least through the end of the year.
Agencies
The Detroit-based automaker says it will reduce its total number of salaried workers to 63,000 from 73,000 this year. About 3,400 of GM's 29,500 salaried US jobs are expected to be eliminated.
The job cuts are part of the restructuring plan GM submitted to Congress late last year. Most of the cuts are expected to take place by May 1.
GM says the cuts will vary by global regions depending on staffing levels and market conditions.
GM also is cutting the pay of most of its salaried U.S. workers beginning May 1 and continuing at least through the end of the year.
Agencies
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