Bowie Castlebank, which owns the Klick Photopoint and Max Spielmann photoprocessing chains as well as the William Munro Cleaners group, has gone into administration, with the loss of 817 jobs.

The company employs 1,664 people in 197 Klick outlets across the UK, 117 Max Spielmann shops in England and 60 Munro premises in Scotland. Staff are also employed at Wishaw, North Lanarkshire, Glasgow and Chester and a further 847 jobs are believed to be in jeopardy.

KPMG, the administrator, said that Bowie Castlebank's photoprocessing unit had become “significantly” loss-making because of the advance of digital photography, while the cleaning business had been hit by reduced use of clothing requiring dry cleaning.

The family-owned Bowie Castlebank dates from 1865, when a widowed forebear of Jonathan Bowie, the present managing director, began to tour factories with a wheelbarrow collecting clothes for cleaning. The present business took shape in the 1960s, when two Glasgow laundry families, the Bowies and the Kennedys, joined forces. Mr Bowie is the fifth generation to run the business.

The company moved into photoprocessing in the early 1980s and has expanded aggressively through acquisitions in recent years. It bought the Liverpool-based Max Spielmann in June 2001.

Meanwhile, the latest monthly jobs report compiled by the Recruitment and Employment Confederation (REC) and KPMG, shows that the number of people securing new jobs plummeted at a record rate last month and is tipped to slide further. Nearly 60 per cent of companies said that they had hired fewer staff in November compared with the previous month, with only 14 per cent indicating that they had recruited more workers. The resulting balance of 28.9 is the lowest recorded since the series begin in January 1998.

Mike Stevens, partner and head of business at KPMG, said there was “no doubt that the UK jobs market is now heading downhill at breakneck speed”.

He added that while temporary staff were often the first to be affected, increasing numbers of permanent staff would face the axe in the coming months, especially in the construction and motor sectors.

This will come as a blow to the Chancellor, who in last week's Pre-Budget Report sought to sweeten the sharp rise in unemployment, forecast by some economists to hit three million next year, by saying that there were still large numbers of vacancies.

Separate reports showed a record decline in construction activity and plunging consumer confidence, piling more presure on the Bank of England to deliver another aggressive rate cut tomorrow.

The Chartered Institute of Purchasing and Supply/Markit construction index showing employment and overall activity in the sector fell to 31.8 from 35.1 in October. This is the ninth consecutive month that the index has been below 50, the level that indicates contraction, and marks the lowest level since the series began in 1997.

The rising alarm over job cuts and continued falls in house prices has also taken a toll of consumers, with confidence falling to a four-year low, according to figures from Nationwide.

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