We should challenge claims about the value of the financial sector to Britainby John Kay / September 17, 2015 / Leave a comment
Published in October 2015 issue of Prospect Magazine
There are good reasons to be sceptical about how much the financial sector contributes to Britain. It is an area in which Britain has competitive strengths, including language and time zone. Private profit without public benefit is a policy problem everywhere in finance, but a particularly acute British dilemma. About 1.1m people work in finance and insurance in Britain. This is 3.7 per cent of the labour force, less than in the United States (4.7 per cent) but more than in France (3.1 per cent) and Germany (2.8 per cent).
Most people in finance do clerical tasks in bank branches, call centres and insurance offices. Four hundred thousand people work in “the City,” the area round the Bank of England that is headquarters to most British financial institutions. Of these, 150,000 work for financial institutions.