LONDON - BRITAIN'S economy appears to be stabilising after the downturn but it could be a while before employment levels start picking up again, Bank of England chief economist Spencer Dale was quoted as saying on Saturday.
In comments that reiterated remarks in a speech earlier this week, Dale said employment had not fallen as much during the current recession as might have been expected and could therefore take longer to recover.
The number of people out of work has been climbing and is expected to hit 3 million by next year, even though the economy may already have started growing again.
'Going forward we may well see employment levels continue to remain low, or fall further, before we start to see a pick up, so I do think the pick up in employment may well be relatively slow and gradual,' Mr Dale told the Exeter Express & Echo newspaper while on a visit to south-west England.
'This is in part because the falls off in employment haven't been so great, so there's more slack within firms to use up before they need to go and employ additional workers.'
But he said there were signs the economy was getting back on a more level footing after suffering its deepest downturn in decades, although it would take some time for conditions to return to pre-crisis levels.
'Things look like they've stabilised and we have turned a corner, but it looks like we are in for a long haul,' he said. 'There's still a long way to go before things are bouncing back to where they were, and it's going to take us a while to get there, but things feel quite a bit better than they did six or nine months ago.'
He also noted firms were still having trouble getting credit and said it would take time for the effects of the central bank's 175 billion pound (S$396 billion) asset purchase programme to filter through.
'We are seeing some signs of improvement, but there still seems to be further to go,' he said.
'We still hear stories that people are finding it hard to access funds in the way that they used to and to undertake new investment projects and expansion. I think that remains a significant issue affecting local businesses,' he said. -- THOMSON REUTERS