FINANCIAL services firms in Scotland could lay off up to 5,000 workers over the next two years, according to an industry expert.
Douglas Adams, an economist at the Ernst & Young Scottish Item Club, predicted that financial companies would cut about 5 per cent of their 100,000-strong workforce north of the Border as a result of the global credit crunch. And workers in related
industries, such as PR, printing and property management, could also be at risk, Adams warned. A further 5,000 people in those jobs could be out of work, he estimated.
Adams said: "Financial services is an important driver for the economy in Scotland. While predictions for London have been that the firms will shed around 10 per cent of their workforce, the picture in Scotland is better. However, it is possible that around 4,000 to 5,000 people could lose their jobs."
He added: "There may be some redundancies, but I think that what is most likely is natural wastage, where companies just do not replace people who have left.
"In recent years, we have taken for granted that financial services will do very well."
Mirroring the overall UK picture as outlined in yesterday's Item Club report, Adams said he believed that Scotland would also see a rise in manufacturing output because of the weak pound.
But he said he did not think it would make up for a downturn in financial services. He added: "Although this is likely to happen, it doesn't necessarily mean that manufacturing companies will employ more people."
A spokeswoman for Scottish Financial Enterprise said she believed Scotland would be less affected by the credit crunch than other parts of the country.
She said: "We understand that it is a challenging time for the industry, but we believe the diverse industry in Scotland and its long-term view will make it more resilient."
The full article contains 322 words and appears in The Scotsman newspaper.
