Senior archaeologists are warning that the recession could result in a long-term loss of skills and expertise from the sector.

According to statistics gathered by the Institute for Archaeologists (IfA), 345 jobs, representing more than 5 per cent of the entire UK archaeological workforce, were lost in the three months to 1 January 2009.

Derek Seeley, a senior manager at the Museum of London Archaeology, attributed this in large part to the fact that the construction industry, which has suffered badly in the recession, drives a lot of archaeological activity in the UK.

"A lot of projects are on hold," he said. "There will be a loss of skill base as people get laid off and go to other sectors. The same thing happened in the early 1990s. It takes years for the skills base to return."

Mike Heyworth, director of the Council for British Archaeology, said: "Clearly, it is going to get worse before it gets better. Whenever there is a downturn, archaeology suffers a loss of skills and expertise. This is a major issue."

The IfA's survey appears to bear this out, as 20 of the 66 archaeology organisations contacted anticipated losing more staff before the start of the new financial year. The IfA hopes to produce a more up-to-date survey later this month.

To add to archaeology's woes, a recent English Heritage study has found that despite "nighthawking", the practice of illegal metal detecting, posing a high threat to heritage, the number of arrests and prosecutions remains low, while penalties for those found guilty are insufficient.

Only 26 cases have led to formal legal action, some of which have resulted in a fine of only £38. English Heritage said this figure was woeful, compared with a £120 fine for illegally parking a car.

Priced out of the market

At least six of the Association of Local Government Archaeological Officers UK's (ALGAO) 19 members across the country are experiencing significant problems.

A big issue, according to ALGAO's vice-chairman, Stewart Bryant, is that county-based services catering for district councils are increasingly looking to charge for their services.

One example of this is Northamptonshire County Council (NCC), which has cut its service to its seven district councils.

An NCC spokesman said: "In 2006, the council ceased to provide non-strategic archaeological advice into the planning process due to budgetary constraints.

"The provision of a historic environment advisory service is currently being reviewed and a working group has been established to discuss options with our partners."