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UK business confidence has hit 'new low', says BDO


However employment scenarios seen improving

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Business confidence among UK business has hit its lowest level for at least 21 years and continues to remain fragile, according to a survey published on Monday by accountancy firm BDO.

In the survey report, BDO noted that its Optimism Index fell to 88.9 in January, well below the level of 95 which is indicative of economic growth.

The accountancy firm said January’s was the lowest level on its record since the survey was launched in 1992.

Peter Hemington, a partner at BDO, said, "It seems the damaging effects on businesses of five years' zigzagging economic growth has left them wary of making concrete plans for expansion and resigned to the 'new normal' of economic stagnation."

"To end this cycle, it is imperative that the government implements plans to expedite growth," he added.

He also said that optimism within the manufacturing sector had improved but overall business confidence continues to remain fragile.

On the positive side, BDO said its employment index rose in January, improving the chances of fresh hiring by businesses over the next six months. Specialist recruitment firm Morgan McKinley also reported positive findings on the jobs front; albeit in the financial services sector.

Its London Employment Monitor registered a 76 percent increase in newly available financial services jobs from December to January. However, on an annualised basis, compared to January 2012, the number of new jobs in the market actually fell by 18 percent from 2,835.

The number of professionals entering the January jobs market was up by 74 percent to 5,065 compared to December when 2,915 job seekers were registered in the market. 

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UK business confidence has hit 'new low', says BDO
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