PwC predicts cuts will cost 1m jobs - papers

PwC warns the austerity budget will cause job losses of 500,000 in both the public and private sectors.

Losing 500,000 private sector jobs will mean in some parts of the UK, one in 20 people will be made redundant as the coalition shaves £83bn off public spending, the Telegraph reports

Job losses will mean a dramatic fall in private sector output of £46bn, and the sector will only be able to generate a million new jobs in four years, but PwC analysts say will not be enough to drag the country back into recession.

In June, the Office for Budget Responsibility said the private sector would create 1.6 million jobs by 2015.

Business services and the construction would be hit hardest, PwC says, with the industries losing 180,000 and 100,000 jobs respectively.

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Fed minutes show support for QE

The release of the minutes of the US Federal Reserve Open Market Committee (FOMC) on September 21 show a widespread support for a fresh round of quantitative easing (QE).

However, support is not universal as Thomas Hoenig, president of the Federal Reserve Bank of Kansas, said yesterday QE would not help drive economic recovery, according to the Telegraph.

"There is simply no evidence the additional liquidity would be particularly effective in spurring new investment, accelerating consumption, or cushioning or accelerating the deleveraging that is hopefully winding down," Hoenig said.

The FOMC minutes show fears the faltering economy could lose more momentum without QE, as concerns over muted inflation, high unemployment and slowing business investment rise.

The minutes read: "Several members noted unless the pace of economic recovery strengthened or underlying inflation moved back toward a level consistent with the Committee's mandate, they would consider it appropriate to take action soon."

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