Worst of City cull is over, says CEBR

BLOOD-letting in the City may finally be at an end, with the Centre for Economics and Business Research forecasting a 1% rise in jobs - 3,000 extra staff - over the next year.

However, the CEBR says it may be four more years before numbers return to the high of two years ago.

'We estimate that from the peak in Q3 2001, pinstriped employment fell 26,000, or 7.9%, to the trough, which we put at Q2 2002, when the number of jobs dipped below 300,000,' it says.

The CEBR expects total City jobs to rise to 302,000 in the third quarter of this year, to 305,000 in 2004 and to 310,000 in 2005.

'It may be 2007 before City employment levels return to the peak levels of Q3 2001,'it adds. Strongest growth will be in corporate finance and securities, it predicts.

Corporate finance has been hardest hit, with employment down 19% according to CEBR estimates. Jobs in derivatives are already rising and the stock market recovery is likely to start lifting numbers in securities dealing.

Still, news of a recovery may be greeted with scepticism as the axe is still out at many banks. Deutsche Bank signalled further cuts earlier this month and HSBC is reducing corporate finance and equities staff.