Report: British unemployment to surge

LONDON, Sept. 15 (UPI) -- Unemployment will surge in Britain by 450,000 to 2.12 million by the end of 2009, a business lobbying group says.

A report from the Confederation of British Industry says the country's economy is already in a recession and that unemployment will surge to levels not seen since 1997 when the Labor Party came to power, The Times of London reported Monday.

CBI Director-General Richard Lambert said in the report: "We are now almost certainly in a mild recessionary phase."

Hundreds of thousands of job cuts are coming and homeowners will continue to struggle with falling home values in the next year, the report says.

The Times said the report is an about-face for CBI, which earlier this year said Britain would avoid recession. The business group has since drastically cut its forecasts because of continued steep increases in energy prices, saying the economic slowdown has been much worse than expected.