Finance, tech and creative industries set to drive London growth

The tech and creative industries will be crucial to London’s future growth, according to a new CBI report.

Businesses are optimistic about London’s growth prospects over the next five years, saying that the key industries to keep the city thriving will be technology, the creative industries and the city’s ever-popular professional services and finance sectors.

The latest London Business Survey from the Confederation of British Industry (CBI) shows that nearly seven out of ten firms said the technology and creative industries would be key to the continued economic growth of the capital in the next five years. Another 65 per cent said that professional services would be an important driver of growth, while 62 per cent said the same of the financial services industry.

As a result, it may not be surprising that East London, around Canary Wharf, the Royal Docks and Stratford, will be a key growth area in the coming years – in fact, nearly six out of ten businesses said this would be a crucial location.

Another 44 per cent said traditional businesses centres around the City, Shoreditch and Old Street will also be important places to watch.

Overall, businesses are confident about the future of the capital, with optimism at a relatively high 65 per cent – although this is slightly lower than the 70 per cent reported in the previous quarter. However, they tended to agree that keeping hold of staff with the right skills was a major concern.

With more than half saying they hope to increase their headcount in the next year, it seems that workers with the right expertise will be in a good position to find new roles. Since skills shortages are already appearing in areas like the tech industry, a talent shortage could well be the biggest threat to growth.

“The technology and creative industries have shot up the ladder as some of the fastest-growing sectors in London, with the majority of businesses seeing them as holding the key to the capital’s future growth,” says Lucy Haynes, CBI London director.

But she adds that to find the right talent to support growth, authorities need to deal with other issues so it becomes easier for people to live and work in the capital.

“If we are to attract and retain the brightest and best minds to Tech City and to the rest of London, we urgently need to tackle the endemic housing problem the capital faces,” she explains. “Freeing up land and building more homes is critical to dealing with this.”