Britain's north-south divide in economic prosperity will be "significantly worsened" by the coalition's £81bn in spending cuts, as job losses and benefit reductions savage northern communities while capital projects such as Crossrail benefit the south, according to an influential thinktank. In findings to be published on Monday, the Institute for Public Policy Research will conclude that a disproportionate amount of the pain from George Osborne's comprehensive spending review will fall on areas north of the Wash, including the Midlands, the north of England and Scotland. The cuts, in jobs terms, will hit hardest in industrial areas that already suffer some of the UK's worst levels of unemployment. And benefit cuts will hurt a bigger section of the population in the north-east and Wales, where 20% of the working-age population are claiming state support compared with 15% in London, 13% in the south-west and 12% in the south-east. "The north is being hit by a quadruple whammy," said Ed Cox, director of IPPR North, who points to cuts in government jobs, the already tepid employment market outside the south-east, a weak private sector and skewed capital investment. He argued that the UK would be left with an "even greater imbalance", but added that the north needed to take charge of its own destiny by developing its own plan for growth. Estimates from PricewaterhouseCoopers suggest that in addition to the 490,000 public-sector job losses anticipated by the chancellor over four years, at least a further 400,000 positions will be lost at companies that do business with the government. In the north, an estimated 233,000 jobs are under threat – equivalent to 3.8% of the region's workforce. In Scotland, Wales and Northern Ireland, the cuts could hit 4.5% of jobs and in the Midlands 3.4%. In the south, the absolute number of likely job losses is higher – 389,000 – but this amounts to just 3.2% of jobs. It could be far tougher for those left out of work to find new employment in the regions. More than 60% of new jobs created in the Midlands and the north between 1998 and 2007 were in the public sector, or at companies relying on the government, compared with less than 40% in London. And the jobs market is already crowded: there are 5.8 jobseekers for every advertised vacancy in a Scottish job centre, compared to 3.8 potential applicants in the south-east. The Observer, p43