London's financial district has lost just 7,500 financial services jobs as a result of Brexit, according to Irish-born City of London mayor Vincent Keaveny.
At the height of the Brexit negotiations, it was predicted that London’s financial hub could lose up to 80,000 jobs as firms reconfigured their operations and relocated staff outside the UK to accommodate Britain’s new trading status.
Approximately 500,000-550,000 people are employed in the City of London.
“A certain number of jobs have moved out of London. We think it’s a very small number, in the region of 7,500,” Mr Keaveny said, while noting there has also been Brexit jobs coming the other way with firms moving into London.
“We’ve also seen tens of thousands of jobs being created on the fintech side of the City which has made any job losses or job relocations on the Brexit side relatively insignificant in the overall scheme of things,” he said.
Mr Keaveny, the first Irish citizen to be appointed to the City of London's mayoral role, was in Dublin this week, meeting with various business groups, academics and Minister for Foreign Affairs Simon Coveney as part of a financial services dialogue event.
Procedures and workarounds
The lower-than-expected job losses stemming from Brexit reflect the fact that London-based banks have put in place procedures and workarounds which allow them to continue to support major operations from London despite the loss of passporting rights, the ability to sell financial services across the EU, he said.
While the EU-UK's free trade deal does not cover financial services, there is a memorandum of understanding on services, which, if implemented, could provide a formal framework for dialogue, which would be in "everybody's interest". However, he acknowledged that aggravations around the Northern Ireland protocol were – in part – delaying its implementation.
Mr Keaveny, a commercial lawyer by trade, remains bullish on the City’s prospects, dismissing any notion that it would lose its position as Europe’s financial capital as a result of Brexit.
Some four million square feet of office space was granted planning in London’s financial district last year, 70 per cent up on 2020, he said, while noting a recent EY report suggested 87 per cent of its clients planned to increase their footprint in London over the next five years.
Corrupt elites
The biggest threat to financial services in London was not from Brexit, he said, but from technology, noting the arrival of new platforms posed a significant challenge to the traditional banking sector .
Despite accusations that London has been used as a hub for money laundering by corrupt Russian elites, Mr Keaveny insisted the City was governed by robust anti-money-laundering legislation.
He did, however, admit that the UK had “an issue around property” and the purchasing of real estate with dirty money or the proceeds of crime.
“One issue that the UK has, but I would also say a number of other countries have, is around property. It’s very visible . . . Where you have individuals buying and owning significant properties, whether on the Côte d’Azur or in Mayfair, it’s a very visible association,” he said.
On the current crisis, Mr Keaveny said financial services was effectively delivering the West's response to Russia's brutal invasion of Ukraine.
