Exodus of Banking Jobs After Brexit Far Lower than Expected

By Lucas Kaufmann [CC BY-SA 3.0 de] via Wikimedia Commons

According to new research, lesser than 4,600 banking jobs will be relocated out of London due to Brexit.

That numbers represent only 6% of the total number of people that are employed by big international banks located in the City – and is far below the previous gloomier predictions.

The estimate of The Financial Times is based on statements from 15 of the biggest banks in the United Kingdom, interviews with over a dozen executives and industry benchmarks.

The research revealed that: in Deutsche Bank, only 350 jobs could be relocated out of London which is well below the 4,000 which was previously publicly-stated; in JP Morgan, around 700 posts could be moved, again far below the 4,000 London job losses that were earlier predicted by boss Jamie Dimon; Goldman Sachs expects to relocate fewer than 500 staff out of London, despite opening a new office in Frankfurt that is able to accommodate 1,000 people.

A senior executive at a large US institution informed the FT: “Every city wants thousands of people, but what are they going to do?”

He said that the staff at its London office “cover clients” who will mostly be staying in the United Kingdom.

In the past, financial institutions have warned that tens of thousands of jobs will be eliminated from London and the United Kingdom after Brexit in March 2019.

They have expressed concerns regarding the ability to carry out seamless transactions across the European Union in the absence of having access to the bloc.

One area that looks set to be greatly affected is the multi-billion euro clearing sector that is currently dominated by London which will most probably move to a major EU city from 2019.

David Davis, the Brexit secretary, has attempted to assuage some of those concerns by promising special travel arrangements for bankers after Brexit.

The chief executive of Morgan Stanley International, Rob Rooney, told the FT: “The story has always been three to five years out, not what does it do to the City the morning after Brexit.”

However, much still depends on what the clients of the banks do post-Brexit; where the clients will be based, how comfortable the clients would be staying put, and what kind of pressures Brexit will place on the basic day-to-day business of doing business.