Government cuts to cost 13,000 jobs in Birmingham, consultants warn

Jul 16 2010 by Jonathan Walker, Birmingham Post

More than 13,000 jobs will be lost in Birmingham because of Government cuts announced so far, an independent consultancy has warned.

Almost one in nine public sectors posts in the city will be axed.

The grim warning came from consultancy The Local Futures Group, which advises local councils and bodies such as the CBI and European Commission.

It published a report warning: “We expect to see the highest job losses in the major metropolitan centres. Birmingham, Glasgow, Leeds and other conurbations will face the brunt of the cuts.”

But Birmingham will be hit harder than any other area - with an estimated 13,205 jobs lost by 2016, according to the study.

The report only considers the effect of spending cuts already announced, such as the £6.2 billion national savings package launched in June.

This is likely to be dwarfed by a much larger series of cuts to be announced in the Government’s Comprehensive Spending Review in October.

It also only includes public sector jobs and does not take into account the effect of spending cuts on the private sector. For example, the cancellation of school building projects could have an adverse effect on the construction industry in the region.

The city most affected after Birmingham is Glasgow, where an estimated 10,942 jobs may be lost, followed by Leeds, where 8,664 could go.

Stephen Hughes, chief executive of Birmingham City Council, has warned the authority might need to make £230 million of savings during the next four years.

The Government argues that cuts are needed to reduce Britain’s budget deficit, currently running at £154.7 billion. Britain’s public debt is £903 billion.

MP Jack Dromey (Lab Erdington) said: “‘This independent study of the cuts announced by the Government in but eight weeks exposes that Birmingham will suffer over 13,000 public sector job losses.

“The city will be hard hit by the effect of twice the scale of what happened when Rover closed. And worse is to come in October when George Osborne will reveal unprecedented cuts to public expenditure that will devastate the economy of the Midlands.’”

Meanwhile, MPs have called on the Government to reverse its decision to abolish Advantage West Midlands, the regional body which is charged with supporting the economy.

A Commons motion signed by 12 MPs including Jack Dromey (Lab Erdington) and Richard Burden (Lab Northfield) states: “There is a vital need for strong, effective and efficient regional development in the West Midlands, one of the worst affected regions in the recession.”