Up to 24,000 jobs could be lost as the global recession bites deep into Scotland’s financial services industry, says a survey conducted for Scottish Enterprise.
The Herald reports :
BRIAN DONNELLY April 13 2009
More than 24,000 financial sector jobs could be lost over the next two years as Scotland struggles through the credit crunch, according to new research.
A study, by senior economists at DTZ, for Scottish Enterprise states the losses in the Scottish banking and insurance industry could represent as much as 8% of its workforce.
The analysis suggests there would be 20,000 jobs lost across the financial services industry north of the border in 2009, which includes potential cuts of more than 1000 in Scotland at RBS, and a further 4000 in 2010.
Analysts said the industry is braced for news of job losses at HBOS after it merged with Lloyds TSB last year. HBOS employs about 17,000 people in Scotland and Lloyds TSB has 7200 staff north of the border.
Some in the industry speculated that as many as 10,000 jobs could go from the new company in Scotland.
The predictions come as reports yesterday said Telecoms group BT was poised to axe another 10,000 jobs as part of a redundancy programme expected to be announced next month.
Professor Gabriel Talmain, director of the Centre for Economic and Financial Studies at Glasgow University, said: "The financial sector was one of the mainstays of the Scottish economy, so if jobs go there then it means that more jobs will go elsewhere; it means that property prices are likely to be hit and the services and hospitality industry will be hit hard."
The analysis for Scottish Enterprise looks at potential job losses among the 100,000 employees who work in the traditional financial services sector in Scotland, a further 100,000 who depend directly on them and another 145,000 in the wider business service sector. The study suggests the recovery in jobs could come by 2015 as financial services in Scotland moves quickly.
Scottish Enterprise said it has been one of the fastest-growing sectors of the Scottish economy. Since 1998 the industry has grown by 96% in Scotland, compared to 84% across the UK sector. The Financial Services Skills Council said it was acting to aid employers during the worst of the cuts.