Sydney's inner and middle-ring neighbourhoods are being sapped of locals who work in essential services including nurses, teachers and police as high house prices alter the make-up of the city's neighbourhoods.

New research has revealed a dramatic slump in the number of key workers living in long-established Sydney regions during the past decade while areas on the urban fringe have experienced significant net gains.

The Parramatta region had the biggest net loss of essential workers between 2006 and 2016 with a decline of 21.4 per cent. Next was the eastern suburbs (-15.2 per cent) followed by Sydney's inner south west (-14.6 per cent), Ryde (-14.2 per cent) and inner west (-11.3 per cent).

During the same period the Southern Highlands, on the extremity of Greater Sydney, experienced a 17 per cent net increase in the number of essential workers living in the region. There were also big net gains in the Hunter Valley (+13.6 per cent) and the Illawarra (+10.5 per cent).