Economy tanking: 50,000 firms could go bust


5:11 pm - October 13th 2010

by Newswire    


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The Interactive Investor today reports that over 50,000 firms are in real danger of going bust thanks to looming government spending cuts

The latest ‘Red Flag Alert’, published by insolvency group Begbies Traynor, found 50,299 companies already experiencing financial distress within construction, IT, recruitment, advertising and business services.

Executive chairman Ric Traynor said that the statistics show that the sectors most likely to be most impacted are already starting to show definite signs of distress.

“With confidence in the construction sector falling to an eighteen month low, recruitment activity at its slowest for almost a year and a strong increase in distress in the advertising sector, there is a growing risk that even if the wider UK avoids a double dip recession, public-sector dependent industries face higher levels of financial distress.”

Dave Prentis of Unison, UK’s largest public sector union, today issued a statement criticising the government’s response to the news:

The Government’s public spending cuts are poisoning the country’s chance of economic recovery. They are putting hundreds of thousands of jobs in the private sector at risk. The public and private sectors are inter-dependent and by hitting one you damage the other.

Today’s red flag warning, comes on top of a report yesterday from Pricewaterhouse Coopers, which put nearly a million jobs at risk. The Government cannot ignore the growing body of evidence that their spending cuts are deeply damaging to both the private and public sector.

Earlier today it was reported that pessimism among UK consumers was at an all-time high.

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  12. Countering the Coalition cuts: a myth-busting guide | Liberal Conspiracy

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