Credit crunch could claim 20,000 City jobs by end of 2009

The credit crunch will claim 20,000 City jobs by the end of 2009, according to an economics think-tank.

The Centre for Economics and Business Research (CEBR) forecast that up to 11,000 jobs will be axed this year and a further 8,200 in 2009, with corporate finance, investment banking and derivatives the sectors that will suffer the most.

CEBR said the economic slowdown would take until 2012 for the number of jobs to recover to levels recorded in 2007.

CEBR senior economist Dominic Walley said: “The persistence of the credit crunch and magnitude of its impact on many key markets in the City has forced us to revise our forecasts for City jobs in 2008.

“We now expect 11,000 jobs to be shed this year, compared to our previous estimate of 7,000 job losses. Furthermore, the outlook for 2009 has deteriorated. There is little sign of light at the end of the tunnel for the City.”

A recent report by recruitment consultancy Morgan McKinley warned that the job market in the financial services sector will be ‘tough’ for the remainder of 2008.

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