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Page last updated at 12:20 GMT, Tuesday, 7 September 2010 13:20 UK
Can the private sector rescue us from the recession?
Workers at Francis Brown Ltd
Francis Brown Ltd has doubled its workforce in the last 10 years

Business owners on Teesside have offered contrasting views on whether the private sector can lift the UK out of recession.

The coalition government is expected to announce large cuts to the public sector, with our region expected to be one of the hardest hit.

The government has said it hopes the public sector can absorb some of those job losses, but is that realistic?

BBC Tees Luke Walton has been to meet businesses in Stockton to find out...

Remaining positive

The Chancellor, George Osborne, is expected to announce cuts of at least a quarter in some areas of government spending, that will inevitably mean job losses on a large scale.

However, the government is banking on the private sector to create enough new jobs to fill the gap.

It's hoping firms like Francis Brown Limited in Stockton will be able to grow and expand its workforce.

The steel fabrication was founded more than a century ago, and has experienced a boom period in recent years, in fact during the last decade, the company's workforce has doubled to almost 60 employees.

Simon Brown, the firm's finance director, says it is constantly training apprentices due to an upturn in demand:

"We were involved in developing the prototype for the world biggest one megawatt tidal turbine which has just been installed off the Orkney isles.

"Certainly when people talk about the doom and gloom about recession you can get drawn into it, but it's definitely not the case for us.

"We are constantly looking forward and remaining positive", he adds.

Unrealistic aim

According to the North East Chamber of Commerce, Francis Brown Limited isn't a one off.

Joanne Fryett from the group is anticipating more small to medium sized business will flourish after the public sector cuts:

"I think where private sector can pick up, it will do if it's got the capacity to do so.

"But what I think we'll find is that we'll develop new business and many of them will go into self-employment."

However, not everybody shares that sense of optimism. Simon Pearson is founder and chairman of Pearson's, a Teesside communications business that specialises in advising employers on online recruitment.

Recently he's been getting more business from the private sector, but a squeeze on his public sector work has meant he's had to cut staff.

He remains dubious over the government's plans: "Public sector recruitment for efficiency reasons has been winding down for a few years.

"There are a lot of private sector companies that are suppliers to the public sector, so what about the supply chain?

"What about the companies that supply the companies that supply the public sector?

"One large outsourcing company recently told me they were looking at the edge of a precipice."

State of the Region is a BBC campaign looking at the impact of public sector cuts on our region.

Find out more on BBC Tees, 95fm and Look North.

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