EEDA - East of England Development Agency

Region's jobs lost in recession regained by 2015

7 September 2009

Jobs lost in the recession in the East of England will be regained by 2015 with the regional economy picking up in 2011 says a new report from Insight East published today.

The first comprehensive report on the impact of the recession in the region and what the outlook for the economy might be is from the region’s only dedicated economic research and analysis unit. Funded by the East of England Development Agency (EEDA) Insight East’s report will help the region’s key decision-makers plan for the future.

The report says 167,000 jobs are likely to be lost before the recession ends but once employment recovers in 2015 there are likely to be more jobs in R&D, IT and other business services than before the recession started. 

Despite the economy contracting in line with the rest of the UK, the report presents economic growth projections which suggest that from 2011, the region will overtake the rest of country, with economic growth peaking in 2013.

Main impacts of the recession from the recession report:

• total employment is down by 14,000 in the last year (second quarter 2008 to second quarter 2009) with unemployment up 59,000 and rising – it now stands at 194,000
• 167,000 jobs are likely to be lost in total during the recession (2008 to 2010)
• Peterborough, Harlow, Luton and towns in the Thames Gateway have seen the biggest rise in claimant unemployment at around 2.5%
• manufacturing and construction have been the worst hit as well as transport and logistics.

Key points from the forecasts:

• there may be a 4.1 per cent contraction in growth in 2009 in the East of England with slow recovery from 2010
• projected growth at 0.3% will match the UK average until 2010, then grow to peak of  3.9% in 2013, beating the rest of the country
• all sectors except manufacturing will recover most, if not all, jobs by 2015 and construction will bounce back
• education and health sectors have seen a rise in jobs during the downturn and will experience strong recovery post-recession
• there will be 30,000 more jobs in R&D, IT, recruitment, property and call centres and other business services than before the recession started
• all areas will start to recover from 2011 except Cambridge which will recover quicker, from 2010; all county and unitary areas, apart from Luton and Peterborough,  will recover their pre–recession employment levels by 2016
• post-recession, 2011-2015, East and South Cambridgeshire, Cambridge, North Hertfordshire and Hertsmere will experience the strongest employment growth

Glenn Athey, director of Insight East said:

“Insight East’s report presents, for the first time, an analysis of the recession, its impacts to date and some views on what the future outlook may be for the East of England economy. 

“There is no doubt that the impact of the recession has been severe and recovery will be sluggish from 2010 with unemployment continuing to rise in the short-term.

“The good news is that, based on our understanding of recent trends, the region may well regain those jobs lost by 2015 and that there will be more jobs than before the recession started in areas that the region is traditionally strong including R&D and information technology, which are sectors that will power the economy of the future.

“This unique service, funded by EEDA, will help inform the decisions that local authorities and other public sector partners need to make now by giving them a view of the future. Economic forecasts are part of the toolkit used to inform that view but are not facts waiting to happen. Decision-makers will find the report helpful to gauge the broad direction and magnitude of change in the future.”

EEDA has £30 million of funds available every year to help businesses survive the recession and thrive in upturn, available through the innovative Business Map www.bizmapeast.co.uk

EEDA is investing over £350 million over the next three years to 2011 in the regional economy including in future growth sectors such as ICT, biotechnology and renewable energy.

 

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