Recession to hit Leeds, Brighton and Bristol hard

Date: 09/01/2009

Leeds, Brighton and Bristol together could lose over 5% of their jobs over the next three years, according to a new Centre for Cities study on the three cities.

City redundancies hit London hard last year - and dominated the headlines.  But the impact of the credit crunch and the deepening recession is now being felt in every city - and will play out very differently across the UK during 2009.

If the recession is mild, and the national economy contracts by 1.1% in 2009, Leeds, Brighton and Bristol are likely to shed 21,000 - or 2% of their jobs over three years.  But a contraction of 2.5%, which looks increasingly realistic would mean as many as 56,000 (or one in twenty) jobs could go across the three cities, by 2011.

Leeds, England's second financial services centre, could see 11,600 jobs go over three years if the recession is fairly mild and as many as 28,000 by 2011, under more severe economic conditions.  30-40% of these losses will be in financial and related business services.  Job vacancies in the city have already declined by 33% during the autumn - over double the national average.

Brighton has built a reputation for independent and vibrant shopping.  But the city could face between 2,400 and 7,400 job losses over the same period (depending on the severity of recession) - 30-40% of which will be in retail and leisure.  The city risks losing a major unique selling point if these businesses go under.

Bristol has seen growth in high-value manufacturing over recent years.  The city could now see between 7,500 and 20,600 jobs go over three years - with just under a third in manufacturing.  Whilst the future of larger players like Airbus - with longer term contracts, appear safe for now - smaller ‘supply chain' businesses that provide its components could run into trouble.

*Leeds' financial and business services, Brighton's retail and leisure and Bristol's manufacturing sectors.  Not all job losses are a result of recession.  Some can be attributed to long term industrial decline.

Dermot Finch, Director of Centre for Cities said,

"No city will be immune from this recession. Even our most successful cities - like Leeds, Brighton and Bristol - are set to lose around 5 per cent of their jobs over the next three years - in financial services, retail and manufacturing.

Today's report suggests some practical steps that these three cities can take to mitigate the worst effects of the recession - by focusing on where their strengths lie. Leeds should work hard to retain its financial services niche, Brighton should protect its independent retail sector, and Bristol should support its manufacturing supply chains."

Howard Kew, chief executive of Leeds Financial Services Initiative (LFSI) said:

"It is important to note the report's conclusion that the fundamentals for Leeds' success as a financial services centre remain positive and that the sector should remain one of Leeds's principal strengths.  This concurs with our view that there is resilience in the city's economy.

"LFSI is already part of a task force with the city region leadership set up to address the impact of the downturn and LFSI, with the backing of Yorkshire Forward, is launching a programme this year to proactively promote the strengths and benefits of Leeds city region as a financial services centre and be ready for the upturn."

For more information, please contact: Rosamund Taylor, Centre for Cities, 0207 803 4316

Mobile: 07876 175 426
r.taylor@centreforcities.org

For comment for Leeds Financial Services Initiative, please contact Andrew McKeon, LFSI: 01423 734560 or 07802 484 155. Email: andrew@ajmpr.co.uk

Note to editors:

Into Recession: Vulnerability and Resilience in Leeds, Brighton and Bristol, by Dr Malcolm Cooper and Kieran Larkin is available upon request, or for download.

The report makes specific recommendations for Leeds, Brighton and Bristol offering some practical ideas on what they could do to stem the tide of jobs losses and business closures.

The job loss forecasts in the study were commissioned by the Centre for Cities for this report and calculated by Oxford Economics.  The forecasts are based on two scenarios for the UK economy - one is based on a contraction of 1.1 per cent in 2009, the other forecast accounts for the impact of a harsher recession, in which UK output experiences a contraction of 2.5 percent in 2009.

The Centre for Cities is an independent urban policy research unit. It is a registered charity (No 1119841) and a company limited by guarantee registered in England (No 6215397). Our main goal is to understand how and why economic growth and change takes place in Britain's cities, and to help cities improve their economic performance.

1 Under a more severe recession we expect job losses to continue into 2011.