While it is widely acknowledged that financial and related professional services play an important role in London’s economy, this report shows that they also have a prominent role in a number of other cities, in terms of the exports they generate and their productivity.
Within this, London-headquartered businesses play an important role in these sectors elsewhere in the country. In cities such as York and Norwich, for example, over half of their finance jobs are in companies with a headquarters in the capital.
Importantly though, the nature of these activities differs across cities. In Edinburgh and Bristol, for example, many of the jobs in London-headquartered businesses tend to be in higher-skilled activities. In contrast, while these businesses also make an important contribution in terms of jobs in cities such as Northampton and Middlesbrough, these jobs tend to be lower skilled. This shows the varying relationship between the capital and these cities, with the latter in particular providing back-office functions to financial activities in London.
As the UK prepares to leave the European Union, the nature of future trading relationships across the world will have implications for exports of all goods and services. While London undoubtedly plays a large role in Britain’s financial and associated professional services sectors, this report shows that the terms of a deal on financial services will have implications beyond the capital too.