Making Britain the fastest growing economy in the G7 is a bold, fitting and hard ambition. Without harnessing the contribution from financial and related professional services, it’s also an impossible one.
Our industry is represented across the UK, in every region and nation, with two thirds of the 2.4 million people it employs (or one in every 13 workers) based outside the capital in thriving financial hubs such as Birmingham, Belfast, Manchester, Edinburgh, and Leeds as well as cities and towns such as Warrington, Milton Keynes, Swindon and Reading. Financial services is also a highly productive sector – its productivity being three times higher than the national average.
Financial and related professional services is more than just a key component of the UK’s economy; it is the backbone of our nation’s prosperity. Our research shows that this industry generated 354,000 jobs in the decade to 2022, with more than half of these created outside London. It is truly a national asset, investing in communities, supporting businesses and people in their everyday lives and enabling growth across the economy.
In 2022 (the latest available data), the industry contributed £248bn to the UK economy – over 12 per cent of the country’s total economic output. Yet, despite its already considerable contribution, the UK’s role as a leading international financial centre creates a unique opportunity for it to unleash faster growth. In our latest report, enabling growth across the UK 2024, we highlight the targeted policy interventions needed to spur that outcome and enable the industry to further drive inclusive growth across the country.
These policy proposals are focused on greater devolution, improved connectivity between regions, comprehensive reforms to skills policy and Britain’s outdated planning system – all of which will further empower local economies. Greater devolution is crucial in this context.
Greater and more consistent decentralisation of power has the potential to boost inclusive growth and prosperity in every region and nation of the UK. This strategy promises a clearer climate in which business can thrive and allows local leaders to make strategic decisions based on the needs and opportunities of their communities.
Improved connectivity, both in terms of physical infrastructure and digital networks, is another key priority. Strengthening the links between our country’s financial centres will enable businesses to grow and workers to access new opportunities. This connectivity is especially critical as we aim to attract foreign direct investment to every region and nation of the UK.
And reforming the country’s skills and planning systems is paramount. Our industry is involved in the planning system at all stages; ensuring a highly skilled workforce is critical to its continued success.
This is why enhancing the apprenticeship levy and transitioning to a more flexible growth and skills levy will better prepare our workforce for the challenges ahead. Equally, fundamental reform and streamlining of the planning are essential to provide greater predictability for investors to deliver the infrastructure we need to address the housing crisis and achieve the transition to net zero.
In his first speech as Prime Minister, Keir Starmer spoke of the urgent need to repair the fabric of the country and to maximise economic growth. Our industry can be an enabler of that mission and should be central to the new government’s strategy.
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