More than 330,000 jobs will lost across the business services sector during the coming three years, researchers warned today.

The Centre for Economics and Business Research (cebr) said that the recession would lead to more than half of the jobs that were created in the business services sector during the past five years being eliminated by 2011.

Even by 2013, there are still expected to be 311,000 fewer jobs in the sector than there were during the peak year of 2008.

The group said that sectors which relied on the investment cycle, discretionary budgets and public sector spending would suffer the most, with advertising the worst hit.

The business services sector has been one of the best-performing parts of the UK economy in recent years, accounting for about one third of all new jobs created and 5 per cent annual economic growth since Labour came to power in 1997.

However, the credit crunch and recession have reversed this trend, and employment in the sector is expected to be 8 per cent lower in 2013 than at its peak in 2008.

The prediction contrasts with the 20 per cent rise in employment and the 15 per cent increase in output seen by the sector between 2003 and 2008.

The cebr report 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.”

The advertising sector alone is expected to shed 15,000 jobs during the period, after already seeing revenues fall by 3.9 per cent in 2008.

The group said that the recent and continued deterioration of public finances would have a significant impact on the business services sector, as the public sector accounted for a significant proportion of its revenues.

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 or the business services sector from strong performance to significant losses would have been hard to imagine even at the onset of the financial crisis.”

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