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South West economy could lose £4.2 billion and more than
100,000 jobs
09 September 2010
Up to 116,000 jobs could go across the region over the next five
years, according to analysis by economists at the South West
RDA.
In a report on the likely impact of budget cuts on the region
written jointly with the South West Observatory, the research shows
that around 86,000 public sector jobs could go. In addition
10,000 jobs could be lost across distribution, retail, hotels and
accommodation as wages and consumption fall and 7,300 jobs in
business services.
The cuts would result in a corresponding loss of £4.2 billion
Gross Value Added, the measure used to estimate the value of goods
and services produced in an area, industry or sector of an
economy.
The RDA’s economists suggest that rural areas such as West
Dorset with a high dependency on public sector jobs are likely to
be hard hit. While urban centres such as Bristol may suffer
greater job losses, the private sector may be able to take up more
of the slack. Other areas, such as smaller urban centres and
peripheral areas - where private sector activity is weaker - will
feel the effects most.
Nigel Jump, Chief Economist, said: “The South West has depended
heavily on public sector jobs in the past decade and a half.
This will not continue, and, in the short term, there seems little
prospect that the private sector will fill the gap. In areas
such as West Dorset, where the public sector accounts for nearly 40
per cent of employment, or Torbay, which also has a flagging
economy and relatively high dependence upon the public sector, that
could mean quite a shock. We’ll start to learn more in the
autumn, when the Comprehensive Spending Review is published.”
Vinita Nawathe, Managing Director of the South West Observatory,
said: “While a lot of the detail is yet to be understood, this
report makes use of the best available evidence from the South West
Observatory’s established local and regional network of
intelligence experts. The report does indicate cuts across
the public sector will be hard felt across the South West.
Our network will review and update the evidence as more information
becomes available.”
The wide-ranging analysis demonstrates that large scale cuts
across the region in defence could also affect the South West
disproportionately. Defence has a strong presence in the
South West, which accounts for 37 per cent of England’s civil
service defence employment and 29 per cent of regular armed forces
personnel. Any cuts are expected to be compounded by the
effects on the defence supply chain, with many key defence
contractors located in the South West.
The full report can be found on the Economy Module section of
the South West Observatory website www.swo.org.uk/economy.
ENDS
Notes to Editors
The Economy Module of the South West Observatory is provided by
the South West RDA Economics and Evidence Team. It provides a
comprehensive data and analysis to support regional development and
evidence based decision making. To improve the availability of
regional data the Economy Module has developed a set of Regional
Accounts which are freely available to all. For further information
please visit the Economy Module website (www.swo.org.uk/economy).
The South West RDA works for and promotes a modern, stronger and
more resilient economy across South West England. Our work
involves creating better jobs, successful businesses, more
prosperous cities, towns and villages within an economy that uses
less carbon and will still be thriving in 20, 50 and 100 years
time.
The South West Observatory Core Unit is a Social Enterprise
company limited by guarantee that networks the intelligence
functions of public bodies in the South West region. It
achieves efficiencies and avoids duplication through the sharing of
resources, best practice and joint commissioning to support
evidence-based decision making of its members and others. For
further information please visit the SWO website (www.swo.org.uk).
For more details contact: RDA Press Office, 01392 229389.