City of London is booming despite Brexit doomsters
OF ALL the Brexit scare stories which have been put about over the past couple of years none seemed quite so terrifying as the future predicted for the City of London. Should Britain vote for Brexit accountants PwC warned in April 2016, two months before the poll, the City would shed between 70,000 and 100,000 jobs by 2020.
After the vote the doommongers seemed to get louder and louder. In January 2017 Xavier Rolet, chief executive of the London Stock Exchange, claimed that the City could lose 232,000 jobs, while Douglas Flint, chairman of HSBC, told the Commons Select Committee that the City was like a “Jenga tower” which could collapse as a result of Brexit.
Yet as with so much else from Project Fear, these predictions have proved spectacularly wide of the mark.
While we haven’t yet left the EU, there has been little sign of City institutions paring down jobs by any significant extent in order to prepare for Brexit. On the contrary, in the two years to the end of 2017 the number of jobs in the financial sector – which includes the City as well as other jobs in banking and insurance in the UK – actually grew by 23,000 to 1.134 million.
THE London economy as a whole is booming – in spite of efforts by Mayor Sadiq Khan and others to try to talk it down. The think tank Centre for London this week revealed that the number of jobs in the capital has risen by 1.9 per cent over the past year.
In one of the few pieces of negative news, Deutsche Bank announced last month that it was moving its Euro Clearing operations to Frankfurt. The news was widely reported without bothering to give the full story – that the move was not going to mean any jobs leaving London.
Given that the City is the heart of the UK financial sector, which accounts for 6.5 per cent of the UK economy and contributed £119billion to GDP in 2017, outsiders could have been forgiven for taking the Brexit warnings to heart.
Yet City figures have form when it comes to making lurid threats if they don’t get their way. It was only three years ago that HSBC was threatening to relocate to Hong Kong or the