Tuesday, May 27, 2008
Will be interesting to see how our 'services-based economy' holds up in the new era we're entering.
BBC News: Services fall 'worst since 2001'
"Companies such as restaurants, bars and cinemas have had their biggest drop in business activity since 2001, according to the employers' group the CBI...Profitability was the weakest since the survey began in 1998 and employment in the sector fell for the second quarter in a row. "
And this is just in Q1/Q2 - the start of it. Expect the job losses to start around October, with repossessions really ramping up from beginning of 2008
Posted by doom&gloom @ 04:40 PM (884 views) Add Comment
10 Comments
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1. doom&gloom said...
Of course the job losses are happening already as the survey shows, but doesn't seem to be that serious yet. Anecdotally, restaurant owners are telling me their trade is down, and weekends in the bars seem to be a bit quieter already. But not seen bars and restaurants going out of business & closing down yet, as they did in the last slump.
2. Rental John said...
Service jobs rely on supplying services to those earning wages in 'proper' jobs - as those proper jobs dry up, what are we left with? 50% of the population picks up job seekers allowance, etc....and the other 50% work in supermarkets.....not a good economic model!
3. confused76 said...
but I have heard of bars and restaurants reducing staff, mostly immigrants, ... big problem for BTLetters...
4. the haunted said...
This is just the start. People don't just feel like they have less money but that the money they do have is not going far enough. For example, I have just been asked by two fellows at work to car pool with them, which I have agreed to given the cost of petrol. They both said they needed to cut back and that they could do with some extra money in their pockets.
With everyone starting to count their pennies who will feel like they can afford to eat out etc (excluding politicions)? Restaurants and bars will see bigger drops in business before the year is out and the effect on the greater economy will only worsen their situation.
5. wiltshire said...
Many sellers of alcohol could really have done with at least one of the British teams appearing at Euro 2008 but alas.
6. it_is_going_with_a_bang said...
I can tell you now I have already cut my out of home eating by 50% now.
Thats a big drop.
Which is probably offsets my increased diesel £1.30 a litre !
The service sector is in big trouble.
What comes after cutting wages? Not being able to afford sky high commercial rental demands. Watch out commercial sector ...
7. doom&gloom said...
@IIGWAB. Exactly the cut I have made - 50%. Was eating out 3/4 times a week, now 1-2 at most. Admittedly we are probably ahead of the trend on this - the majority who don't budget who will be merrily eating and drinking out until they reach the end of their CapitalOne credit lines, but the effects are be being felt by businesses already.
They can let the Eastern European staff go, but how are they going to cut costs after that? Commercial rents are either going to plummet or there will be a lot of empty units on our high streets this time next year (more likely).
8. Doghouse said...
Funny how you notice things when you're out of your home area....I drove through Manchester and Oldham a few weeks ago and began to notice how many boarded up pubs there were, seemed like every other pub was empty. Is this a recent phenomena?? The product of the smoking ban?? or lack of cash??
9. japanese uncle said...
However hard those rotten scoundrels are trying to rig the market by manipulating oil price, 'when the money is gone, it's gone' will be the golden rule that prevails. Bars and restaurants won't instantly shut down, before desperately struggling to attract customs by price competition. This will eventually apply to all sectors as precisely happened in Japan. 'The worse since 200X' in the headlines will be replaced by 'the worst since 199X', and 'since 198X' and eventually 'since the records started'. Unemployment will double and treble, and irregular employment without insurance and benefits will be the predominant style of employment soon, where wages drop spectacularly. High streets will be lined up by the so called 'pound shops'. I do not know about the small market for the privileged few millionaires and billionaires, but this gloomy picture will be the horrific reality for the 58 million of the 60 million in this land.
10. Robin said...
Maybe there will be another bonus out of all this...these businesses might realise that SERVICE is what they need to give to the CUSTOMERS. I have stopped spending my hard earned cash because of the lack of service but would like to go back.