The franchise industry has been warned to prepare for a lean year as the country’s recession worsens.

According to the Franchise Business Economic Outlook for 2009, prepared by PricewaterhouseCoopers LLP, the gross value of goods and services in the will decline by 0.5%, or $4.2 billion, in 2009.

The number of franchise businesses is expected to decline by 10,000, or 1.2%, and shed 207,000 jobs, a decrease of 2.1%.

The warning comes after nearly a decade of solid growth for the $835 billion franchise sector.

According to International Franchise Association figures, between 2001 and 2005 the sector enjoyed an average increase of 5.6% per year in the number of franchises established, while employment rose by 3.7% annually.

But the sector had begun to show signs of slowing growth in 2007 and 2008.

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