Britain's engineering industry is on the brink of recession, it was claimed today.

Investment and output is down and job losses are up because of the worldwide economic slowdown, said the Engineering Employers' Federation.

It now expects engineering growth of just 0.7% this year - the lowest forecast since 1993.

Chief economist Stephen Radley demanded further interest rate cuts to prop up the sector.

He said: "We expect the next official data will confirm that engineering is almost certainly in recession, with output, orders and margins all heading downwards."

Updated: 11.27 Tuesday, July 3