Monday, July 22

Banks begin moving jobs outside UK just because of Brexit



A report by The Boston Consulting Group after the EU vote warned that up to 80,000 jobs could be shifted out of London.

The recruiters says US banks have begun hiring for roles in European cities other than London in the wake of the UK’s vote to leave the EU.

The executive recruitment firm said rival financial centres to the City within the bloc, Frankfurt and Paris, were seeing the bulk of the growth at London’s expense.

Stephane Rambosson, managing partner of DHR International, said some companies were using Brexit as a “handy excuse for getting on (with) the unpleasant task of moving jobs outside London.”

The findings suggest that the warnings of an exodus of jobs from the City in the event of a Leave vote are now becoming a reality.

The report’s publication coincided with a plea from business groups, including the Institute of Directors and TheCityUK, that ministers maintain access to the single market, take a sensible approach to immigration and reject protectionism as part of Brexit negotiations.

It is a reaction to worries expressed by UK companies about the years of uncertainty ahead. A survey of chief executives released on Monday found 76% were mulling moving operations abroad.

Lloyd’s of London – the London-based specialist insurance market – said last week it was planning to open offices in the EU as losing “passporting” rights to trade across the bloc would affect about £800m of its business.

Many top US banks gave financial support to the Remain camp during the referendum campaign

Citi donated £250,000 to Britain Stronger in Europe, making it a major financial contributor alongside Goldman Sachs, JP Morgan and Morgan Stanley.

They have adopted a ‘wait and see’ approach to the make-up of their future European operations following the result.

That can be explained by the fact the Government is yet to trigger Article 50 of the Lisbon treaty to formally commence the UK’s exit – giving little away on what terms it will seek.

DHR suggested that alongside Brexit contingency planning, companies were also able to accelerate cost-savings of up to 40% by relocating roles to cheaper cities.

“Firms were already making plans to move middle and back office roles out of London in order to cut costs, but now Brexit has acted as a catalyst for radical surgery, providing firms with the impetus to act on these plans immediately,” Mr Rambosson said.