UP to 2,500 jobs could be lost and Sunderland's economy could be set back years if the UK votes to leave the EU next month, according to a new study published today.

The “major independent, non-political study” was commissioned by Sunderland Economic Leadership Board from the internationally-recognised consultants PACEC.

They were asked to explore the likely economic impacts of a leave vote in the light on the unique issues facing businesses, employers and investors in the city.

Sunderland Economic Leadership Board chairman Paul Callaghan said: "The report shows that given the importance of foreign investment and trade to the Sunderland economy, the consequences of Brexit would be significant and largely negative for the city.”

The city’s economy is dominated by large, foreign-owned companies in trading/exporting sectors, most notably the automotive manufacturing cluster centred on the Nissan.

Mr Callaghan said the report found that under either the Norway or the World Trade Organisation option, the Sunderland economy would contract, with the loss of around 2,500 jobs.

The research also highlighted the potential negative consequences that Brexit would bring in terms of regeneration funding. Since 2007, the city has received over £23million of direct investment from Europe, complemented by over £130million of region-wide business support services.

Sunderland City Council leader Councillor Paul Watson said: "The report highlights the real consequences for our city if the UK does not vote to remain in the UK - the impact on local jobs, on inward investment, on business growth opportunities, and on the city's international reputation as a centre of manufacturing excellence will all be undermined.

"The North-East is a net beneficiary of the EU, if we do decide to leave EU the money we currently pay in won't come back to the North East.

“So a decision to leave the EU could seriously hinder the short and long term growth prospects for our city."

Jonathan Arnott, UKIP's North East MEP, said: "This report is pure fantasy, arguing against a model of Brexit that no serious Leave campaigner is proposing.

“No-one's suggesting anything other than replacing every penny of EU funding from the massive £350million a week we currently hand over to the EU.

“Even the IN campaign admit that we could get a better deal than Norway, yet the report takes the Norwegian model as the best-case Brexit scenario.

“This is one of the least impartial 'independent' reports imaginable."

The report comes as than 130 North East businesses put their name to a letter backing a ‘Remain’ vote at the EU Referendum on June 23.