The business services sector in the United Kingdom may see over 300,000 job losses in next four years due to the impact of the recession, a report by economics consultancy Centre for Economics and Business Research (CEBR) has said.
". . . there will be 311,000 fewer business services jobs in 2013 compared to 2008. Those sectors that rely on the investment cycle discretionary budgets and public sector spending would suffer the most," the report said.
Business services jobs had increased by 616,000 from 2003 levels to 2008 levels, it said.
"The business services sector will suffer dearly from the recession; more than half of the jobs it gained during the last five years will be lost over the next five years. Among all of the subcategories, advertising is set to be the worst hit," the report said.
According to CEBR, advertising industry would be the worst hit sector as it is expected to slash 15,000 jobs during 2008-13. The sector witnessed a 3.9 per cent drop in revenue during 2008.
Battered by economic recession and liquidity crisis, employment in the business services sector is expected to be 8 per cent lower in 2013 as compared to the peak in 2008.
"The business services sector, one of UK plc's leading lights in recent years, will find the operating environment for next five years to be very different compared with the previous five years.
"Steep drops in business investment, the collapse of the property market and construction industry, upcoming cuts in public sector spending as well as continued difficulty for firms to find capital imply difficult times ahead for this sector," CEBR's managing economist Ben Read said.
The report noted that the recent and continued deterioration of public finances is also going to have a significant effect on the business services sector.
"Though most sectors in the UK economy will suffer from the recession, the dramatic reversal of fortunes for the business services sector from strong performance to significant losses would have been hard to imagine even at the onset of the financial crisis," Arek Ohanissian, one of the authors of the report said.