Leader: Jobless Figures Underline Need for Fresh Rate Cut

Summary

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AFTER the lightning comes the storm. The blind panic which has gripped the world's financial markets over the past couple of months may be subsiding, as governments implement a GBP 1.5 trillion rescue package. Yet we have still to see the full impact on the real economy of the vast loss of wealth that results when share prices collapse; of the drop in house prices which has made ordinary people feel much poorer; and of the sharp reduction in credit being offered by ailing banks. All this has the makings of a serious global recession, with output falling, trade contracting and unemployment rising.

The evidence started piling up yesterday. In the UK, unemployment rose by 164,000 - the biggest quarterly jump in 17 years. Leading economic analysts are predicting a total of two million unemployed by the turn of the year. In Scotland, which until the early summer had bucked the recessionary trend, the jobless rate has also turned upward. In particular, in the past three months, more women than men have been forced out of employment and also out of the Scottish labour market altogether.

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Leader: Jobless Figures Underline Need for Fresh Rate Cut

A similar pattern is found throughout the major industrial countries. The economies of the 15 eurozone members started contracting in the second quarter of 2008 and are certainly in recession. The UK and the United States are expe...

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