• Further fall in North Sea production which has dropped by almost 50 per cent in the past three years 
  • Cameron declares Britain must be more like Germany and develop a modern workforce
  • Fears a cold winter could spell further economic gloom

By Daily Mail Reporter

PUBLISHED: 08:22 EST, 8 December 2012 | UPDATED: 08:27 EST, 8 December 2012

In a blow for Chancellor George Osborne financial markets have predicted Britain is heading for a triple dip recession

In a blow for Chancellor George Osborne financial markets have predicted Britain is heading for a triple dip recession

Britain is on the brink of a triple-dip recession, experts warn as latest figures reveal industrial output has now fallen to its lowest level in 20 years.

In a week when chancellor George Osborne put yet another squeeze on the hard working middle-classes, figures for October revealed manufacturing production dropped by 1.3 per cent  - more than two per cent down on this time last year.

Markets had been optimistic that October would have seen a rise in industrial production but figures from the office for national statistics revealed it had fallen by 0.8 per cent.

This was partly caused by a fall in North Sea production of gas and oil, which has dropped by almost 50 per cent in the past three years.

Forecasts prepared by the Office for Budget Responsibility see the economy continuing to shrink for the final three months of 2012 before growth resumes early 2013, picking up steadily throughout the course of the year.

But the OBR has, in the past, been accused of being over-optimistic in its predictions and many economists question whether their figures would be met.

Some are calling this recession the worst yet - and while not as deep as those experienced in the 1920s and 1930s, recovery has been considerably slower.

Yesterday David Cameron declared that Britain must be more like Germany and develop a more modern workforce after companies complained of a lack of newly trained engineers.

Optimists have pointed to a strong start to the Christmas shopping season and progress being made in Europe to tackle the sovereign debt crisis.

The wider measure of industrial production fell 0.8 per cent, reflecting a record fall in oil extraction although this was partly due to maintenance on North Sea rigs.

Making do: The fall in factory output was far worse than had been expected.

Making do: The fall in factory output was far worse than had been expected.

Industrial production fell 0.8 per cent, reflecting a record fall in oil extraction although this was partly due to maintenance on North Sea rigs

Industrial production fell 0.8 per cent, reflecting a record fall in oil extraction although this was partly due to maintenance on North Sea rigs

The decline adds to the recent flow of disappointing numbers for the UK economy at the start of the fourth quarter and bodes ill for GDP after a rise of 1 per cent in the autumn ended the longest double-dip recession since the 1950s.

The ONS said yesterday that the trade in goods deficit – the difference between exports and imports – widened to 9.5billion in October from 8.4billion in September.

It came as exports fell one per cent in a blow to ministers pinning their hopes on booming demand for British goods overseas to more than make up for subdued spending at home.

Container ship

Downturn continues: Exports fell 1 per cent, dashing hopes on demand for British goods overseas

Exports are more than 10 per cent lower over the year to some major European countries including Germany, Italy, Spain, Belgium and Luxembourg. However, exports to China are 7.6 per cent higher than a year ago.

They were up 6.3 per cent to the United States and 65.1 per cent to South Korea. The ONS noted 'a shift in the pattern of the UK's trade' – with exporters becoming far less reliant on the troubled eurozone for business.

Markit chief economist Chris Williamson said: 'Judging by the official data that we have seen for the fourth quarter so far, notably retail sales, trade and industrial production, the UK will struggle to avoid a renewed downturn in the economy after the brief return to growth seen in the third quarter.'

The Office for Budget Responsibility this week slashed growth forecasts for the next five years and predicted a borrowing bill some 84billion higher than its last estimate.

Mr Williamson added: 'While a dip back into contraction may prove mild and short lived, the concern is that any new downturn will not only put further pressure on the UK's AAA credit rating but also provide a further set-back to a much needed improvement in business and consumer confidence.'

The comments below have not been moderated.

Yipee! Everything is going to be triple Dippie! This must surely indicate that all 3 party poopers are going to dig very deeply, truely and madly into their own back pockets to sort out our Christmas biz are they? Joined up Manifest oh, please Ladies and Gentleman of the Coalition. After all, we are all in this ! together and it is the season of goodwill hunting!

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youre to blame with the banks & 13 blue bloodline famlies you work for & Mr R ,you idiot ,

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107 comments and yet no one is willing to do anything. We are in the digital age, we all have FB, lets create a page and organise a protest. For God's sake we can all join together to make a song number 1 but we can be bothered to get off our bums and do something about it. We need action now, before they sell us down the river. Someone pick a date, make a page, share it and lets get rid of these idiots...

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The tories like toblame labour, but the rot started with Mrs Thatcher and big bang. What have you got to say to that GO. In fact the answer is in the question.- countywize , norwich, United Kingdom, 08/12/2012 17:52....The rot started with the Unions when power went to their heads and they wanted to prove they ruled Industry. Instead they killed it. Thatcher took away Union power and the recovery, after a cough and a splutter started to take effect. Then the Blair/Brown years took us a trillion pound in debt as they built up a huge Government and missmanaged the Nations finances trying to get as many people (voters) as possible state dependant. The History books will record that as fact, but don't let that change your red rage.

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i wonder who's left to blame. because some one's going to get the blame. when i say some one i mean some one else bar him and his cohort's

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DM readers seem to forget what the state of the country was like in 1997 when the party were booted out !.

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Osborne is slowly and deliberately strangling the economy. But hey, he doesn't care he's a millionaire and so is his boss. Recession is for the hoi-polloi not the Old Etonian elite. We need a government of real people who understand the realities of existing on a shrinking budget, not a bunch of cavalier toffs and hooray Henry's.

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The problem we have in the UK is that we dont have a General Election for another two and a half years.

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This isnt a surprise as our beloved businesses and bosses have shipped most of our factories to China

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Hey, Osborne, have you thought about a Plan "B" yet ? . . or are you still arrogant enough to believe Plan "A" is the only plan to have? . . . It must be lovely to be able to fail when using everyone else's money, and then move into a highly paid non-job somewhere deep within the EU when booted out at the next election.

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