47,000 more engineering sector jobs will be lost

A FURTHER 47,000 engineering jobs will be lost this year even though the industry is recovering, a survey warned yesterday.

The Engineering Employers Federation said the fresh redundancies would bring the number of jobs lost in the sector since 1990 to more than 400,000.

Despite the gloomy outlook on employment the EEF forecast a resumption in growth of engineering output after an unexpected downturn at the end of last year.

However, only the electronics and motor vehicle sectors are forecast to grow more than 2 per cent this year while aerospace output will continue falling.

The EEF also warned that economic recovery could be knocked off course by a widening trade deficit, fuelled by the weak level of exports to other European Union countries. The deficit in engineering goods is forecast to rise from pounds 4.5bn in 1993 to pounds 7.2bn this year.

Ian Thompson, the EEF's economics adviser, said: 'We are worried that the UK economic recovery could be in trouble if the trade deficit widens too much.'

Tax rises this April would also have an impact, albeit a much smaller one, but they would not stop the recovery as some commentators had forecast.

Graham Mackenzie, the EEF's president, confirmed that it had abandoned plans for a full-scale merger with the Confederation of British Industry and was considering an alliance with the CBI's national manufacturing council.

Regional associations had expressed reservations about a merger, fearing it would threaten their autonomy.