A new report points to a significant number of job losses in the region
The Item Club has forecast around 2,800 job losses in the area by the end of this year.(Image: Getty)
The Humber economy could be one of the hardest hit if the Iran war continues to impact on the UK, an influential group of economists has said. The Item Club believes that the UK could lose more than 150,000 jobs this year and said that South Wales and the Humber will suffer the most because of sharp energy price rises.
The Humber area has been singled out because the area is heavily reliant on manufacturing and construction industries. The Item Club has forecast around 2,800 job losses in the area by the end of this year.
The report predicts there could be 163,000 job losses around the country due to a drop in consumer spending combined with rising energy costs for businesses, which will increase inflation. Low income areas could see households suffer the steepest hikes in the cost of living, as more of their spending goes on essentials, such as food, fuel and energy bills, which are set to see big price rises.
Tim Lyne, economic adviser to the Item Club, said: “Some of the lowest income regions will feel the biggest effects of the manufacturing and construction sectors reducing headcount in the face of rising energy prices and supply chain disruption. “While consumers in these areas typically have less rainy-day savings, which will reduce spending in the retail and hospitality sectors.”
He added: “Across the UK, the jobs market is going to soften, but it’s looking especially fragile in South Wales and the Humber as they’re particularly exposed to manufacturing businesses that are seeing big increases in their costs of materials. Resilience will come in places like Cambridge where the tech sector is based.”
The most recent figures published show that unemployment in the Yorkshire and Humber area stood at 5.5%, a small fall on the previous month’s figures. But those statistics come from the period just before the start of the Iran war and they are expected to rise in the coming months.
A Government spokesman said: “Recent figures show that there was an improvement in the labour market at the beginning of the year with unemployment falling below 5%, and 332,000 more people in work than a year ago. But we cannot escape the effects of the war in the Middle East which are likely to feed through to prices and employment in the coming months.
“We will do everything we can to support the country through this period, including by slashing energy bills by up to 25% for 10,000 manufacturers. “Our mission for clean power by 2030 will get us off the rollercoaster of fossil fuel prices, to cut bills for businesses and households for good.”
Did you know you can make Hull Live a preferred source of Hull news in Google, which will mean you get more of our breaking news, exclusives, and must-read stories straight away? Here’s more information about what this means and how to do it – you can also do it straight away by clicking here.