Two-year jobs freeze thawing

LONDON has reached another milestone in its impressive economic bounce back with companies last month hiring more staff than were fired for the first time in more than two years.

Encouraged by a surge in new business and expectations that the good times will continue, firms in the capital brought to a close 26 consecutive months of job-shedding to increase staffing for the first time since July 2001.

The rate of hiring was only marginal but in line with that across Britain as a whole. The findings come in the latest Royal Bank of Scotland London poll, based on the respected CIPS/Reuters Purchasing Managers' Report.

The survey's headline activity index was 62 in October, a big improvement on September's 59.8 and the fifth consecutive month of growth. A reading above 50 indicates expansion and the October figure was the best since November 2000.

The national figure was 59, meaning growth in London was stronger than that for Britain as a whole.

'Panel members accounted for the increased heightened levels by citing strong sales performance, the clearing of backlogs and the general upsurge in demand across the capital,' the report said.

Today's survey is the latest evidence that London's economy is on the road to recovery following the Iraq war-related downturn at the start of the year.

RBS senior economist Stuart Porteous said: 'Rising employment is a sign that companies in London are now confident enough in the strength of the recovery to begin expanding capacity again.'

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