Up to 100,000 financial service jobs could be scrapped by the end of the decade if the UK broke away from the EU, according to PricewaterhouseCoopers (PwC). The accountancy firm’s findings, part a report commissioned by lobbying group TheCityUK, mean a Brexit could reduce the sector’s contribution to the economy by up to £12bn ($16.9bn).
“While Brexit may not be ruinous for the UK economy, it does risk damaging the UK-based financial services sector, particularly over the short-term, delaying investment decisions and reducing activity. It also threatens the overall competitiveness of the UK as a place to do business.”
The PwC’s report did stress that the financial sector would continue to grow, but the value of its activity would be lower in 2030 than if the UK remained in the EU. The probe also found that the sector would “gradually recover”from the initial shock of a Brexit, however PwC said there may be up to 30,000 fewer jobs by 2030.
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Vote Leave, the lead Brexit campaign in the EU referendum, had not responded to a request for comment at the time of publication. But Eurosceptics have previously accused the “remain” camp of “scaremongering” over potential jobs losses following a vote to leave at the 23 June ballot.
The City of London Corporation is backing a “remain” vote at the referendum, while Goldman Sachs and JPMorgan have warned of a Brexit.
“We believe that a key risk to London retaining its status as a financial hub is an exit by the UK from the EU,” the American firms told the Parliamentary Commission on Banking Standards.
“In common with financial institutions across the City, our ability to provide services to clients and engage in investment activities throughout Europe is dependent on the passport that London-based firms enjoy to operate on a cross-border basis within the Union.
“If the UK leaves, it is likely that the passport will no longer be available, thereby forcing firms that wish to access EU markets to move their operations to within those markets.”
However, some influential voices in the City, such as Newton Investments’ Helena Morrissey, are backing a Brexit. “For me, leaving would not be a vote to turn inwards, but a vote to ‘go global’. A desirable exit strategy needs to enable this, while being practical and minimising short-term disruption,” Morrissey wrote in The Evening Standard.