Worrying surge in redundancy enquiries strengthens case for interest rate cut

Figures released today by the Chartered Institute of Personnel and Development (CIPD) indicate that an increasing number of employers are preparing to make staff redundant.

Analysis of calls to the CIPDís legal helpline – which deals with enquiries from human resources managers – shows a 28% monthly increase in September in enquiries related to redundancy. Of 2051 calls to the helpline line last month 303 were related to redundancy - up from 236 in August and more than double the 142 calls recorded in September 2007. In the past year the proportion of calls to the helpline each month related to redundancy has increased from 9.7% to 14.8%.

The CIPDís Chief Economist, Dr John Philpott, says that the helpline statistics are another worrying sign that the credit crunch is set to take a bigger toll on jobs:

ìA sombre September awash with bad economic news has caused more employers to take steps toward cutting staff levels. A significant decline in the demand for labour this winter now seems clear, which strengthens the case for the Bank of Englandís Monetary Policy Committee not only to cut interest rates tomorrow at the end of its monthly meeting but to cut big.î