London’s financial district will grow its economic output by more than a third and employ 10 per cent more people over the next decade if threats including a possible British exit from the European Union don’t materialise, according to a study.
A report commissioned by the City of London Corporation, which promotesLondon as a financial centre, said the City generated £45 billion in what it termed economic output in 2014, with that figure expected to grow by 16 billion in the next 10 years. That growth will help create 39,000 new jobs in the City -- as the financial district is known -- and where 397,000 workers were employed last year.
Ninety percent of the output gains and 70 per cent of employment growth would be within finance & insurance, media, IT & communications, and legal & accounting businesses, the study said.
Growth within the City will help contribute to the creation of 145,000 new jobs across London as a whole, it said.
“This report shows how vital the City’s success is to growth in London and the UK,” said Mark Boleat, chairman of policy & resources at the City of London Corporation.
The study said the possibility of ‘Brexit’, a lack of skilled employees, unaffordable housing, and limits on aviation capacity could all pose a threat to achieving this level of growth.
Prime Minister David Cameron has pledged to renegotiate Britain’s ties with Europe and then give voters a referendum on EU membership by the end of 2017.
Conservative Mark Garnier, who served on parliament’s Treasury Select Committee, said on Tuesday that Britain’s continued membership of the EU was “incredibly important” for the country’s financial services industry.
“The UK and the City of London is not a destination in its own right, it’s a gateway to the single market in Europe. It’s important we maintain our position in Europe and become an influential member,” he told an industry conference.
The “Brexit” risk is also causing major political uncertainty for the insurance industry, the chief executive of the Association of British Insurers said on Tuesday.
The forecast for job growth in the City of London comes when investment banks across Europe are slashing thousands of jobs as they restructure to meet tougher demands from regulators, pulling out from businesses which are no longer seen as providing adequate returns.
Reuters
