A cloud called Brexit
Two thirds of respondents to the London Business Survey believe the tech and creative industries will be the principal drivers of London’s economic growth over the next five years. “The capital’s booming, world-class tech and creative firms hold the key to unlocking the growth that will ensure the city remains a global business powerhouse for years to come,” says Eddie Curzon, CBI London director.
Over 90% of firms surveyed continue to rate London as a good/great place to do business, according to the study. And they reckon bolstering the resilience of the city’s infrastructure is key to securing future growth, with a majority backing Crossrail 2.
However, Brexit continues to cast a dark cloud. Just under three quarters of firms say uncertainty over the UK’s role in Europe is their top concern, while a similar percentage have developed, or are developing, a contingency plan for when the UK leaves the EU. In fact, over one-quarter of respondents indicated they are planning to move part of their operations overseas. Close to two-thirds are looking at strategies to address skill shortages that may occur if restrictions are placed on EU nationals working in the UK.
Another report published earlier this week by a report published by Baker & McKenzie and consultancy Oxford Economics says a good number of companies might look to leave the UK over Brexit. Over half of businesses in the automotive sector belong to non-EU parents, while non-UK owned firms account for 44% of the healthcare industry.
“It’s clear Brexit is weighing heavily on minds in the capital though, so it’s absolutely vital that substantive progress is achieved during the Brexit negotiations and that comprehensive, time-limited transitional arrangements are agreed with all urgency,” says Curzon.