Business | Economy
London faces huge job cuts as financial firms suffer
The UK economy will grow 1.8 per cent this year and 1.5 per cent in 2009, down from three per cent in 2007, the report said.
- Bloomberg
- Published: 23:56 May 9, 2008
London: London's financial-services industry will cut 10,000 jobs in the next three years as banks and insurers respond to the global credit squeeze, said Experian, the world's largest credit-checking company.
The capital's banking district, known as the City, "will bear the brunt" of financial job losses in the UK, which will total 40,000 by 2011, Nottingham-based Experian said in a report.
Banks and securities firms worldwide have cut about 65,000 jobs as losses and writedowns stemming from the collapse of the US subprime mortgage market climbed to $319 billion. With UK financial institutions paring lending in response to tighter credit markets, economic growth is slowing and Experian forecasts British employment levels will fall for the first time since 1992.
"Financial-services jobs are particularly vulnerable as the fallout from the credit crunch continues," William Thomson, director of international economics at Experian, said. "The slowdown will bring the impressive run of job creation to a halt."
London's economic slowdown will close the growth gap between the southern and northern regions of the UK next year, the first time that's happened since 2002, Experian said today. Normally, the south grows about a percentage point faster than the north.
The UK economy will grow 1.8 per cent this year and 1.5 per cent in 2009, down from three per cent in 2007, the report said.
Slower growth and higher credit costs are threatening to deepen a downturn in the housing market. UK mortgage approvals fell to the lowest level in at least nine years in March.
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