Cuts to be felt over next two years, says expert

Date: 2nd September 2010

A number of small businesses operating in the UK could be among those affected by government spending cuts over the next two years.

Stephen Overell, associate director of The Work Foundation, said the impact of the coalition's spending cuts will be felt until at least 2012.

"Well we are expecting the effect to be felt starting in late autumn, but actually, it will affect the next two years at least, probably beyond that," he commented.

The expert also claimed that the north of England will be particularly hit by the cuts as a large proportion of the local labour force is employed in public services.

"When the cuts come through, these areas are likely to be the ones that are most affected. The private sector won't be able to absorb all the people made redundant in the public sector in the wake of the cuts," he said.

The comments follow the publication of a new report by the Centre for Economics and Business Research, which revealed that the labour market will "remain weak" in many regions until 2015.

Posted by Thomas Fletcher