Huge job losses predicted for business support sector

The business services sector will be one of the biggest victims of the credit crunch, shedding more than 334,000 jobs over the next three years, according to an economic think tank.

Once one of the strongest performing parts of the UK economy, research by the Centre for Economics and Business Research (CEBR) suggests more than half the business support jobs created in the last five years will have disappeared over the next five.

The sector, which includes legal, IT, accountancy and property management services, will be badly hit by cuts in public sector spending, the study predicts. Advertising will suffer the most, with 15,000 jobs to go within four years.

Business services has accounted for about a third of all new jobs created since Labour came to power in 1997, according to the Independent. The CEBR report claims the credit crunch will reverse this trend due to "steep drops in business investment, the collapse of the property market and construction industry (and) continued difficulty for firms to find capital."

Arek Ohanissian, one of the report’s authors said: "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."