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Reuters: 630 finance jobs have left UK – “far less than predicted”

September 26, 2018 at 12:36pm

As few as 630 UK-based finance jobs have been shifted or created overseas with just six months to go before Brexit, a far lower total than banks said could move after Britain’s surprise vote to leave the European Union, according to a new Reuters survey.

Many bankers and politicians predicted after the June 2016 referendum that leaving the EU would prompt a mass exodus of jobs and business and deal a crippling blow to London’s position in global finance.

But as Brexit Day nears, the number of jobs that UK-based financial institutions say they expect to move in the event of a “hard” Brexit was around 5,800, just 500 more than the last survey in March, and with more firms responding. That compares to around 10,000 in the first survey in September 2017.

The results are based on answers from 134 of the biggest or most internationally-focused banks, insurers, asset managers, private equity firms and exchanges to a survey conducted by between Aug. 1 and Sept. 15.

Nearly all of those surveyed said they are moving as few people as possible, hoping for a last-minute political deal that protects access to the EU’s $19.7 trillion-a-year economy after Britain leaves the bloc.

The likelihood of a “hard” or “no-deal” Brexit has increased substantially since Prime Minister Theresa May’s plan for maintaining ties with the EU has been rejected by Brussels as well as by many politicians in her own Conservative Party.

Many business chiefs fear Britain could be heading for a chaotic split that would spook financial markets and dislocate trade flows across Europe and beyond. Some politicians on both sides put the odds of talks collapsing at more than 50 percent.

The survey findings suggest London, which has been a critical artery for the flow of money around the world for centuries, is likely to remain the world’s largest centre of international finance. While New York is by some measures bigger, it is more centred on American markets, while London focuses on international trade.

Extreme forecasts for UK job losses in a hard Brexit scenario have ranged from about 30,000 roles, estimated by the Brussels-based Bruegel research group in February 2017, to as many as 232,000 by the London Stock Exchange in January 2017.

Iain Anderson, the executive chairman of Cicero, a public affairs company, which represents many finance companies, agreed with the survey findings that the impact of Brexit is likely to be much more modest than initially predicted.

Anderson said early estimates were made by executives in a period of unprecedented emotional turmoil following the vote.

“They have now moved through the five stages of grief,” he told Reuters.