About 7,500 private sector jobs disappeared in Burnley in a decade that saw 17,100 created in neighbouring Preston.
The figures are revealed in a report which argues that towns such as Burnley are no longer capable of generating enough jobs for their populations.
Instead the government should support the expansion of buoyant areas, the think tank Centre for Cities says.
Burnley Council said the report painted an "incomplete picture".
The report, released on Monday, argues that globalisation and technological change have "reshaped the geography of private sector growth".
It means some towns and cities, such as those with good transport links, are much better placed to generate jobs, the report said.
On the other hand, it said, some areas have been losing private sector employment for years, masked by a "surge" in public sector jobs.
It argues that government should focus on prioritising its capital investment budgets on towns which have the best chance of creating jobs.
The government should also relax brownfield site planning rules to provide affordable housing and allow businesses to expand in those well-placed town and cities, it adds.
"New private sector jobs will not grow overnight, and will not emerge smoothly across the country," the report said.
"The government should support the further expansion of buoyant cities like Milton Keynes, where new private sector jobs are most likely to appear - and look for realistic opportunities to develop struggling city economies like Burnley."
The reports argues that the decline in manufacturing employment is one of the principal reasons for the loss of jobs in towns like Burnley, once dominated by its textile mills.
Steve Rumbelow, chief executive of the council, agreed with the observation, but said the report's "solutions were a bit thin".
"We believe that you do need to continue to invest in places like Burnley and we're already creating the conditions for growth," said Mr Rumbelow.
"We've been increasing manufacturing production but of course as businesses become more efficient that doesn't necessarily turn into jobs."
Mr Rumbelow argued that some cities experiencing growth, such as Manchester, had an over-reliance on the public and finance sector.
Instead, he said the UK needed a better balanced economy which meant there had to be investment in manufacturing.
"We're seeing the signs now that that's working because we are seeing some of our advanced manufacturing companies starting to grow, and grow successful," he added.
Despite his optimism, Mr Rumbelow agreed that transport links were essential to creating jobs and said the council was working on improving access to Manchester.
"When we get back to growth we know that Manchester will still be one of the biggest drivers of growth in the north-west of England and we have to connect to that," he said.