Britain's manufacturing industry is in its worst decline for almost 30 years, US unemployment is at its highest level for more than 15 years and Europe's recession is rapidly catching up with the rest of the world's, according to data revealed today.

Official UK manufacturing output showed a nine-month decline for industry, which is the single longest downturn since 1980. November's 2.9% fall in output compared with October is the biggest monthly fall in 23 years barring the exceptional 5.4% decline in July 2002 when workers were given two special public holidays to celebrate the Queen's Golden Jubilee.

Andrew Young, senior economist at the Ernst & Young Item Club, said markets had been braced for bad data following surveys earlier this week. But he added: “These figures were even worse than we feared. The sector is clearly in deep recession.”

Manufacturers' output prices stopped falling for the first time in six months in December, bringing factory-gate inflation down to 4.7%. But analysts believe they will continue their downward trend.

“Looking ahead, the surveys suggest that manufacturing output is likely to continue to plunge from here, despite the lower pound,” said Paul Dales, analyst at Capital Economics. “It can't be long before this forces firms to reduce their selling prices significantly. It's not a good time to be in industry.”

European Central Bank (ECB) Governor Jean-Claude Trichet said the global financial system remains fragile despite swift and large-scale action by central banks and governments. He added: “It would be a mistake to underestimate the structural fragility of the present state of global finance and, consequently, of the global economy.”

US employers cut 524,000 jobs during December which was pretty much in line with economists' forecasts.

However, it means total job losses in 2008 were 2.6 million, the highest since 1945. The proportion of people out of work rose from 6.8% in November to 7.2% in December, the highest since January 1993.

The figures reinforced President-elect Barack Obama's plea for action on the US economy. He said: “Every day we wait, or point fingers, or drag our feet, more Americans will lose their jobs, more families will lose their savings, more dreams will be deferred and denied, and our nation will sink deeper into a crisis that at some point, we may not be able to reverse.”

The FTSE 100 index, which had been 20 points lower before the US data, rallied 14.11 points to 4519.48, but Wall Street was still expected to open flat.

Disastrous German industrial output figures and poor eurozone retail figures put further pressure on the ECB to slash rates at its meeting next week.