The same towns in the North and the Midlands that were worst hit by the loss of industry are most at risk of a second surge in unemployment triggered by robots taking over skilled and semi-skilled jobs, a major new report warns today.

Researchers have identified 10 towns that have low productivity and are highly vulnerable to the Fourth Industrial Revolution in which technologies driven by artificial intelligence will make many jobs redundant.

Big cities such as London, Manchester and Birmingham are found to be well placed to ride the automation wave.

But many smaller towns – weakened by high levels of social deprivation – are at risk of falling further behind their bigger rivals, in much the same way as they lost ground with the collapse of heavy industry in the 1980s.

The report calls for urgent action with enterprise zones featuring tax breaks and financial support for firms being created in the ten towns most as risk of accelerating economic decline.

At a total cost of £1.4 billion – £500 for every one of 2.8 million residents – government money should be devolved to local councils for infrastructure investment, urban regeneration, and programmes to reduce social breakdown and poverty.

In addition, they should benefit from scrapping employer’s national insurance payments by high growth businesses.

Critically, the report finds, factors such as crime, drug use, family breakdown and educational failure, make it harder for these post-industrial towns to build economic momentum.

Formerly thriving manufacturing strongholds, such as Dudley, Wigan and Doncaster, are today blighted by a chronic and varied combination of unemployment, high welfare dependency, educational failure, drug addiction and devastating levels of family breakdown.

The report finds the ‘left behind’ towns with high social deprivation are least likely to attract the jobs of the future, which will mostly be service-based and generated in major cities with good transport links, cultural attractions and dynamic local leadership such as London, Manchester and Birmingham.

The think tank has analysed jobs growth figures and calculated that the gap in jobs growth between the prosperous South East and the ‘rustbelt’ regions in the North and the Midlands is only due to widen.