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More job cuts to come says report

26,000 jobs to go and £333m of benefit cuts yet to kick in

Published on November 22nd 2010.

More job cuts to come says report

Greater Manchester has lost 46,000 jobs over the last two years due to the recession, and will lose another 26,000 in the next five years, according to a new report.

People in Greater Manchester are also being told to brace themselves for a collective £333m cut in benefit payments.

Employment levels should climb back to pre-recession levels by 2014/15, however, as it targets growth in the technology and innovation sectors.

A report by Mike Emmerich of the Commission for the New Economy, prepared for the Association of Greater Manchester Authorities, said the job losses represented 3.5 per cent of the region’s employment level and had trimmed £1.8bn off its GVA between 2008 and 2010.

Greater Manchester’s economic growth was still behind the South of England but was ‘more resilient’ than the other regions outside of London, although the report warns of a ‘difficult transition period.’

‘The assumptions made by the Office for Budget Responsibility indicate that 21,900 public sector jobs will be lost across GM over the next five years,’ said the report. ‘This will be accompanied by consequent private sector job losses too. Estimates of these vary considerably, but a considered view would assume around a further 26,760 jobs would be lost.’

The report said private sector growth could offset those jobs however, but those plans came with ‘significant risks.’

It said that many of the unemployed will ‘struggle to return to the labour market’, however, due to fewer jobs and skills mismatches.

The forecasts on the return to pre-recession levels of employment ‘depend on very significant growth’ in the private sector and will require a ‘transformation’ in Greater Manchester’s business profile ‘ towards highly-productive, high-value, high-innovation firms, with the whole business stock being much more internationally connected.’

One idea is to create ‘Technology and Innovation Centres’ and a ‘Growth Hubs’ across the region, for knowledge-led businesses and establish Manchester as a brand in those sectors.

‘Large domestic companies are a key part of this, as are the universities, and especially the University of Manchester,’ it said.

‘The clear and present challenge for Greater Manchester is to develop a creative environment which will result in commercial exploitation getting done here rather than on foreign shores such as Silicon Valley.’

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