The West's towns and cities will be put on amber alert today by the first detailed study into how badly they will be hit by the recession.

A report by the Centre for Cities says Bristol faces high job losses because of the number of people employed in financial services, although they have the skills and qualifications to bounce back.

Gloucester is ranked as amber in the traffic light system but dipping into red, as is Swindon – which is badly affected by the crisis hitting Britain's car industry because of the town's Honda factory.

The Centre for Cities is an independent policy research unit, which earlier this month published a report on how successful cities such as Bristol could be affected by the downturn.

It warned Bristol could lose 20,600 jobs if there was a severe recession, with the city's manufacturing sector most at risk – and said 7,500 would go even in a mild recession.

Today's report looks at Britain's biggest 64 towns and cities, analysing how they will do, and concludes some will suffer less than others.

It says: "Cities are at the leading edge of economic change – while they may be first to suffer the consequences of recession, they will also lead Britain's economic recovery."

Cities such as Bristol, London, Leeds and Edinburgh are likely to see more headline job losses in 2009, because they have high concentrations of financial services jobs.

"However, in the medium-term, cities with diverse business bases, high skill levels and traditions of entrepreneurship will be better placed to recover," says the report.

Places with a weak economy may see fewer job losses in the short term, but those made unemployed in places such as Hull face a far tougher battle to get back into work, as just 15 per cent have degrees.

"It's overly simplistic to say that the South is in for a big correction, and that the North will ride out the storm this time," the document says.

"Forecasts suggest that some parts of the South will bounce back both quickly and strongly – and that other areas may face a longer road to recovery."

The report says cities such as Belfast, Liverpool and Hull are on 'red' because they have high unemployment and a lot of workers with few qualifications.

London and Edinburgh join Bristol on 'amber' as they specialise in vulnerable financial services which are exposed to the recession.

"But they are better placed to weather the economic storm – with stronger employment rates, diverse industries and highly skilled populations," the report claims.

Bristol has the fourth largest concentration of banking, finance and insurance jobs, but also has highly skilled residents, meaning a more flexible and mobile workplace.

C ities on 'green' are mainly in the South East, such as Reading, Oxford and Cambridge, where few people claim unemployment benefits.

Centre for Cities' Stephen Mayne said Gloucester and Swindon ranked as lower amber, dipping into red, with the latter doing slightly worse because of the problems with the car industry.

"Both are ranked in the top 10 for people claiming jobseeker's allowance but they don't do so well on high-level qualifications," he said.

"That is key because if people lose their job, have they got the skills to get another one?

"And while Swindon has few people with no qualifications, it ranks 37 out of 64 cities on high-level qualifications.

"Gloucester is 58th in that category, but Swindon has the problems at Honda which could really plunge it a lot lower than Gloucester."

Director of the unit Dermot Finch said UK cities would be hit harder than they think by this recession, and in different ways.

"Bristol will lose a lot of financial services jobs, but many of its workers are highly-skilled and adaptable.

"Cities will lead us out of recession – but they can't just rely on action from Whitehall."