Optimism about London's economy grows - and east is where it's at

Sarah Spickernell
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Technology expected to be the biggest contributor to London's economy (Source: Reuters)

Optimism about London's economic growth remains high, according to a business survey by CBI and KPMG.

Although a slight decline from last year's 70 per cent, it showed that 65 per cent of businesses are currently positive about the future of the economy, with 79 per cent rating London as a good, or very good, place to do business.

East is where it's at

58 per cent of the firms said that they believe east London, including Canary Wharf, the Royal Docks and Stratford, will be vital to the city's future economic growth.

Shoreditch, the City and Old Street were also considered to be important areas for future growth.

Richard Reid, London Chairman of KPMG, said that this is in part because of investment brought to the area by the 2012 Olympic Games, but that investment in young people must occur to keep growth there.

“Just as the investment made in east London as part of the 2012 Games is now paying dividends in attracting businesses large and small to this diverse part of the capital, investment in providing greater training for our young people now is vital for their future and the future health of the economy,” he said.

Concerns about the future

Amid the optimism, however, there are concerns about the future.

The report shows that the biggest worry for employers will be retaining key staff, with 97 per cent of them expecting this to be an issue over coming years. Lack of appropriately skilled staff and reduced consumer demand are also high on the list.

Once again, Reid believes that the solution lies in training the younger generation. “The success of our technology sector, like all other sectors in the capital, relies on the ability for businesses to have access to a skilled talent pool of staff,” he says.

“Earlier careers advice in schools, more focus on vocational training and schools working more closely with employers could all support economic recovery and growth in the longer term.”

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