Economy hits bottom, Seco says

The chief economist at the State Secretariat for Economic Affairs (Seco) says the Swiss economy has most likely bottomed out and will soon grow again.

This content was published on August 16, 2009 - 16:20

"I assume that the low point has been reached," said Aymo Brunetti in an interview published on Sunday in the Sonntag newspaper.

Switzerland fell into a recession officially in the spring. Seco says the economy will shrink 2.7 per cent this year.

Brunetti expects the Swiss economy to grow again in 2010 by 0.4 per cent but tempered the news with worrisome unemployment figures. Companies will continue to slough workers until winter 2010-2011, when the unemployment rate could begin to improve, he said.

In July, unemployment rose to 3.7 per cent compared to 3.6 per cent in June. Seco analysts estimate the rate will hit 3.8 per cent by the end of the year and 5.5 per cent in 2010. That is more than double the rate of 2.6 per cent recorded in 2008.

On Sunday, Guglielmo Brentel, president of the Swiss Hotel Association, said his sector could drop 10,000 jobs from the 100,000 positions currently staffed. About 1,000 hotels out of the 5,500 in the country could go under, he said, calling for a SFr25 million ($23.32 million) injection to launch an aggressive marketing campaign.

Meanwhile, Radical Party parliamentarian and Bern industrialist Johann Schneider-Ammann said the crisis could cost the country's machine, electric and metal industries up to 25,000 jobs – about half of all new positions created between 2004-2007. In the first half of 2009 the sector lost 10,000 jobs alone. and agencies

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