Rural areas are especially hard-hit by a decline in local shops and services, according to a report on "Ghost Town Britain".

The independent New Economics Foundation (NEF) has issued projections that paint a picture of rural economies in deep decline.

The report states that between 1995 and 2000, the UK lost 20% of its local outlets - corner shops, grocers, high street banks, post offices and pubs, and highlights fears that the trend will accelerate.

Rural economies are struggling despite efforts to revive local outlets.

Village life centres on the local community

The research predicts that many areas with 3,000 people or fewer will have no local outlets by 2010.

Policy director Andrew Simms said: "Changes in the way we shop, bank and communicate are creating ghost towns in Britain.

"Things could get much worse if current trends lead to a negative tipping point."

Tough trends

There is a national trend toward large outlet stores, only accessible by car, which often offer lower prices than village shops.

Rural residents have complained about poor public transport, including minimal bus service and train services aimed at commuters which do not stop in smaller stations.

Some village pub owners say reduced business - sometimes blamed on stricter drink driving laws, and competition from corporate pubs in larger towns - have made it more difficult to stay open.

Postal worries

Another trend, use of email, and a policy change which means benefits claimants no longer pick up cash in post offices, means less post office traffic in some areas.

The government announced a plan in December to invest �450m in the rural post office network.

Two village post offices in Cambridgeshire will reopen this week.

The Rural Community Council co-ordinated a grant scheme this year to encourage growth in rural communities by offering �5,000 to those who open postal outlets in pubs or village halls.

Locals rally

In some areas, community involvement has helped.

In the villages of Harleston and Long Stratton in Norfolk, 12 volunteers have kept police stations open overnight and on weekends.

And last year, more than 100 villagers in Maiden Bradley, Wiltshire banded together to purchase a local shop which was about to close.