CBI announces predictions for 2008 employment

The Confederation of British Industry (CBI) has warned of a rise in unemployment next year, it has emerged.

According to reports, the CBI, which operates on a not-for-profit basis, believes that over the course of 2008, unemployment will increase to 1.7 million, with a further increase to 1.75 million the following year.

Earlier forecasts by the CBI had predicted a decline in the number of jobless individuals in the UK.

"While the 2008 slowdown may appear dramatic set against this year's strong growth, the fundamentals of our economy remain sound and talk of a full-blown recession is overstated," said Ian McCafferty, chief economic adviser for the CBI.

"Uncertainty surrounds the extent to which current credit conditions will affect both business and consumer confidence and how far the property markets will suffer," he added.

Moreover, the CBI believes the country's economic growth will be negatively affected by the current price of oil, in addition to the ongoing credit crunch.