Three lockdowns in England made relocations for bankers in the City and Canary Wharf impossible, thereby significantly slowing an exodus of finance professionals post-Brexit.
Closed borders and harsh travel restrictions imposed on the general public earlier this year led to banks postponing the relocation of some of its professionals, according to professional services firm EY.
Nearly half (44 per cent) of 222 financial services institutions in the City and Canary Wharf that were covered in the most recent EY’s Financial Services Brexit Tracker survey have moved or plan to move some of its London-based staff or services out of Britain and to Paris, Frankfurt, Milan or Amsterdam, this is a jump of 3 per cent compared to 2020.
However, the actual number of relocations has dropped year-on-year, EY found.
The total number of job relocations out of the City of London dropped to 7,400, from 7,600, after several large investment banks reconsidered initial plans and revised down the number of roles they will eventually move to the EU.
Moreover, the survey showed that new hires across both the UK and EU that can be linked directly to Brexit hit just over 5,000 roles, of which 2,800 were created in the EU, against 2,200 in Britain.
“Travel restrictions over the last two years have challenged the practicalities of relocation,” said Omar Ali, head of financial services for Europe, the Middle East, India and Africa at EY.
“Depending on the trajectory of the omicron variant and its impact on international travel in the short term, delayed moves should pick up over the coming year, not least due to ongoing pressure from EU regulators,” Ali explained.
Actual shift falls short of estimates
Ali also pointed out that the actual shifts fall well short of initial estimates after the referendum. For example, think tank Bruegel warned in 2018 that London’s financial services space should brace itself for a loss of around 10,000 banking jobs and another 20,000 roles in the wider finserv industry.
“For many financial services firms, we are still far from being fully ‘post-Brexit’,” Ali pointed out.
“It’s been nearly a year since the U.K. officially left the European Union, but the financial sector is still working through the hangover of Brexit.”
d Omar Ali, head of financial services for Europe att EY