Unemployment in Sussex has risen by 10% in the last three months as firms cut staff to try to stay afloat.
New figures released by the Office for National Statistics reveal the number of people seeking work in the county rose by 2,700 to 29,892 in the three months to February.
Last night business leaders warned that worse is to come as more jobs are lost under cost-cutting plans in the public sector.
Up to 120 jobs are to be cut at Brighton and Hove City Council over the next year, along with 400 at West Sussex County Council and 200 at East Sussex County Council.
The unemployment rate now stands at 3.1% in the county – higher than the south east average of 2.8%.
Business leaders and politicians warned that the Government’s austerity programme was hurting Sussex and urged ministers to help the private sector to take up the slack. Unemployment in Brighton and Hove has risen from 6,465 in November to 6,959 in February.
Tony Mernagh, executive director at the Brighton and Hove Economic Partnership, said the Government could not rely on the private sector to absorb job losses in the public sector.
He said: “Brighton is outperforming the rest of Sussex but it will get worse before it gets better, especially locally where public sector job cuts have yet to bite.
“I think most people are unaware of the huge scale of cuts that the Government’s austerity programme will impose at local level.
“The private sector will struggle to take up the slack unless there is much higher growth in the national economy which no one, not even the Government, is forecasting.
"Employers have cut most of the overheads over which they have control.
"With no real growth prospect in sight all they can cut now is staff.”
Mark Froud, chief executive at Sussex Enterprise, the county’s chamber of commerce, said the figures were disappointing but unsurprising.
He said: “We urge the Chancellor to use next week’s Budget to introduce measures that will allow businesses to create even more jobs.
“Tax rises, like the business rates rise scheduled for April, should be scrapped to give employers confidence.
"With job losses in the public sector likely to continue, private-sector job creation must be put at the top of the Government’s agenda.”
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