AROUND 3,000 jobs have been lost in the manufacturing sector in Burnley over the last five years, a new report revealed today.

Nearly one in four manufacturing jobs have been lost including 177 job losses with the closure of Papermarc in August, a further 120 job cuts with the closure of Northern Textiles in June 2003 and the shutdown of Michelin in March 2002, which saw the axing of 450 jobs.

The slump is revealed in a State of the Economy study produced by Burnley Council to help councillors understand the current position of the local economy and inform their decision-making.

The report, which will be discussed by the local economy scrutiny committee at a meeting on Monday, also highlights education problems, deprivation and a brain drain from the district.

It describes a "the virtuous circle" of manufacturing investment, labour productivity and wages "which remains a serious problem", with investment, productivity and wages significantly lower than the national and county average.

Secondary schools are said to be performing badly with the number of youngsters gaining GCSEs falling and a "brain drain" away from Burnley with teenagers leaving the area to go to university and not coming back for employment.

The report concludes: "The links between education, skills and deprivation need to be addressed if Burnley is to meet its objective of creating a strong and prosperous economy.

"Levels of deprivation in the Borough remain extremely high, and further funding opportunities need to be sought if further inroads are to be made into alleviating these problems.

"The poor performance of secondary schools in recent years, along with the loss of graduates to other conurbations will similarly need to be addressed if Burnley's emphasis on diversifying the economy is to be met with labour from the local economy."

But the report is not all doom and gloom and says the manufacturing job losses have been replaced by jobs within the service sector, particularly in education and health care.

Unemployment has remained consistently low and the most deprived wards of Daneshouse with Stoneyholme, Bank Hall and Trinity have witnessed large falls in unemployment over the last few months.

Burnley Enterprise has also consistently outperformed other East Lancashire enterprise agencies, helping 141 new businesses so far this year.

The report also gives general information on the area, stating that Burnley remains the only district in Lancashire to have a decline in population over the last ten years, with a population of 89,542.

The Health and Social Care sector remains the largest employer in the Borough with nearly 5,600 employees, followed by retail, education, real estate and business activities and the manufacture of textiles.

According to the 2004 Index of Deprivation the Borough ranks as the 37th most deprived area in England with 25 per cent of the population living in areas within the top ten per cent most deprived in the country.