A Sussex-based tour operator is to axe 1,100 jobs in the wake of the United States terror attacks.

First Choice Holidays will shed up to 60 per cent of its British workforce but said it was uncertain how many jobs would go in Sussex.

The misery was compounded when Portslade-based Panorama Holiday Group announced it was cutting an unspecified number of jobs.

First Choice employs some 500 people at its Crawley headquarters, according to business group Sussex Enterprise.

The tour operator's Air 2000 subsidiary will also face job losses.

First Choice's decision to shed staff follows a wave of announcements of job cuts in the airline and airport industry.

Sussex Enterprise estimates 7,000 jobs will be lost in the Gatwick area before the situation stabilises.

First Choice said last night it had started consultations with staff about the proposed redundancies.

The tour operator put the cost of disruption caused by last month's attacks on New York and Washington at £10 million.

It said its performance prior to September 11 had been in line with market expectations and the restructuring programme would lead to an annual saving of £20 million.

Employees leaving the company's Crawley headquarters last night remained tight-lipped about the cutbacks.

One said staff had not been told where the axe would fall.

Chief executive Peter Long said: "We have had to make some very difficult decisions with the uncertainty we have in the world today. We have had to reduce the organisation and it is clearly a very difficult decision.

"Business had been in good shape before the attacks but, since then, we have seen a lot of uncertainty and therefore we have to take appropriate action.

"Since the attacks we have seen a 30 per cent drop in terms of forward bookings. We are filling our aeroplanes but a lot of people are not booking as far in advance.

"It has had an adverse impact in terms of bookings. Our customers are booking later which makes it more difficult for us to determine the size of our programme."

Mark Froud, policy director for Sussex Enterprise, said the job losses were part of the inevitable shake up in travel and related industries.

He predicted up to 7,000 job losses in the Crawley and Gatwick area before the situation settled down.

Mr Froud added: "We recognise that a number of companies like First Choice will be forced to take action to ensure they are in a stronger position to grow in the longer term.

"We will be doing everything we can to help companies affected by the uncertain times."

British Airways, which employs 10,000 people at Gatwick, has announced it intends to shed 7,000 jobs company-wide. Virgin Atlantic is cutting 1,800 jobs.

Hundreds of baggage handlers also face an uncertain future after handling company Aviance announced it intended to slash 700 jobs at UK airports.

Unions fear 30 per cent of those job losses could be among the 1,500 people employed at Gatwick.

Doug Murdoch, councillor responsible for economic development at Crawley Borough Council, said: "It is clearly very disappointing news and sympathies are with the staff."

More job losses were announced by Panorama Holiday Group last night.

It said a number of people had been made redundant but refused to give a precise figure.