Unemployment Hits Service Sector at Fastest Pace in UK

10:48
Over the past seven years, the UK economy has seen a significant drop in employment rate especially in the service sector. It is because of the rise in uncertainty over the future that has led companies to hold back on hiring replacements for the dismissal of staff, according to a survey.

Stats manifest that the last month the economy stayed closer to stagnation and this was the result of the fall in staffing. It is undoubtedly a worrying signal. This may account for the constant rise in unemployment, causing sufferings to people due to inability to meet day-to-day operations and needs. People may turn to financial institutions for meeting their regular needs, but this will be like a turn of the screw - you have already been running out of money and you take out unemployed bad credit loans in the UK that you cannot repay because you are all but strapped.


The brief on survey report

According to the survey, the employment index fell from 49.7 to 48.2 in January, reported as the lowest level throughout the last seven years. The reading below 50 demonstrates decline, an alarming state, and the reading over 50 shows growth.

The survey has suggested that BREXIT UNCERTAINTY is the biggest reason for ceasing the growth in the economy.

The chief business economist at IHS Markit, Chris Williamson said: “The latest PMI surveys indicate that the UK economy remained close to stagnation in February, despite a flurry of activity in many sectors ahead of the UK’s scheduled departure from the EU.”

“The data suggests the UK economy is on course to grow by just 0.1% in the first quarter,” he added.

Since 2012, whereas the economy experienced a rise in construction jobs, it also faced a drop in the manufacturing and service sector. The rise in construction jobs failed to offset the diminution in the employment rate in manufacturing and service sectors.

Further, the survey reported employers restructured their companies by replacing only redundant employees but not those who left voluntarily.

No-deal Brexit would put thousands of jobs at stake

A no-deal Brexit will have disastrous repercussions on the growth of economy due to decline in gross domestic product.

Small to medium-sized businesses are struggling to cope with the prospect of the deal. The economy is warned that it could be hit by a six-month export ban to the EU. It is still not clear what happens next but majority of the representatives of nations, who are the members of EU, wish the UK not get out of the EU.

A large number of people will take help from loan companies

With a reduced employment rate, many people are struggling to manage their finances. If employment opportunities do not rise, situation will become worse regardless of Brexit. The rise in employment opportunities is a must not only for the growth of GDP but also for people. The living cost is high and it is crucial that people’s earnings also rise.

If it continues to happen for a long time, more and more people will turn to direct lenders and other loan companies to tide over. The demand of unemployment loans with no guarantor will unusually rise.

These loans come with high interest rates because of two reasons: first off, you have a bad credit history and secondly, these loans usually carry short tenure. If you have a good credit history, you will be able to get the loan at a lower interest rate, but the situation will not be far different.

Due to lack of full-time employment, you will be reliant on other sources of income such as a part-time job or freelancing. Not everyone will be able to take advantage of these opportunities because competition will rise.

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