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Research and statistics FAQ


City employment | City population | Number of businesses operating in the City | Gender analysis of employees in the City | Nationality of the City workforce | The City's contribution to the UK economy | International trade in financial services | Employment in financial services across the UK | The contribution to tax revenues in the UK | The City as an international banking centre | Payments clearing system in the UK | Foreign ownership in the financial sector | Foreign exchange business | Stock exchange equity business | Eurobond trading | Financial derivitives | Exchange traded derivatives | Asset management | Insurance business | Shadow banking | Regulation of Financial sector firms | Charitable giving by City businesses | Trading between businesses in the City fringes and firms in the City | Key facts about the City of London | The City of London produces a number of quarterly periodicals | The City prospectus - The City's local economic assesment

City Employment

The large number of people who come to work each day in the City – mainly to work in finance and business services – contrasts with the relatively small number of residents actually living in the City.  The numbers employed in Canary Wharf, which is home to a number of key financial institutions, also fell slightly.


Employment Market

2009

2008

City of London - all sectors

316,700

328,100

Canary Wharf - all sectors

105,000

109,900

Financial services in Greater London

315,200

349,200

Financial services in Great Britain

1,034,600

1,111,500

Source:  ONS Business Register and Employment Survey, December 2010



For more detailed information, see City of London publication City Statshot – Employment Trends in the City, December 2010 (64kb)

For an analysis of current trends in the City’s employment market on a monthly basis, see Morgan McKinley’s London Employment Monitor: http://www.morganmckinley.com

City Population

By contrast with the City workforce, the number of residents actually living in the City of London is very small, even though numbers have been rising in recent years.

Gender

City of London

London

UK

Total

11,500

7,668,300

61,792,000

Males

6,300

3,851,200

30,374,000

Females

5,200

3,902,400

31,417,900

Source; Office for National Statistics, 2009 Mid-Year Population Estimates
  
The mid-year population estimate for the City of London in 2005 was 8,700.

Number of businesses operating in the City

Whilst the head offices of most of the country’s leading financial institutions are located in the City, it also has in addition attracted a large number of foreign firms which operate in financial markets.  There are also many small and medium-sized firms operating in the City.

Total number of City Enterprises Enterprises with less than 10 employees Total finance and insurance enterprises
12,755 10,280 3,095

Sources:  Office for National Statistics, Business Register and Employment Survey, December 2010, and the Financial Services Authority, December 2010


For more detailed information, see City of London publication City Statshot – City of London Enterprises, January 2011 (112k)

Gender analysis of employees in the City

Although there are nearly as many women in the UK labour force as there are men, in the City there are many more men than women working in its key sectors.

Area

Male

Female

City of London

178,582

133,249

Greater London

2,168,288

2,000,239

Great Britain

13,504,363

13,172,834

Source: Office for National Statistics, Annual Business Inquiry, December 2009

For more detailed information, see City of London publication City Statshot – Employment by Gender, July 2010 (59kb)

Nationality of the City workforce

There is no official source of data available.  However the Census conducted every ten years does produce ethnicity data on a workplace basis which is available from http://www.statistics.gov.uk

The City's contribution to the UK economy

The City of London’s contribution to the national income is estimated at 2.4% of the total, while financial services represent 19.5% of total national income (or gross value added) in the whole of London.  The financial services sector accounts for 10% of the total national income of Great Britain.     
Source:  Office for National Statistics and Oxford Economics

See also Oxford Economics' calculations of the contribution of financial and professional business services to GVA (202k) in the City, Greater London and the UK

International trade in financial services

The financial services sector makes an important contribution to the UK’s balance of
payments, with the overall surplus in financial services reaching £40.2bn in 2009.  Total exports of the services sector as a whole amounted to £170.8bn, giving a surplus on the services balance of £55.4bn.            
Sources:  Office for National Statistics, UK Balance of Payments Pink Book 2010, and the
CityUK’s publication UK Financial Sector Net Exports 2010.

For more detailed information, see City of London publication City Statshot – Financial Services and UK Invisible Trade, November 2010 (120kb)

Employment in financial services across the UK

Just over one million people currently work in the financial services sector in the UK, with approximately one-third of that total employed in the financial services sector in London.  The rest of the employment in the sector is spread across the UK, reflecting local business needs.  Other key financial centres include Edinburgh and Leeds, both with more than 30,000 financial services employees, and Manchester, Glasgow and Birmingham, each with around 25,000 in the industry.
Source:  Office for National Statistics, Business Register and Employment Survey, December 2010

For more detailed information, see City of London publication City Statshot – Geography of employment in financial services in the UK, October 2010 (71k)

The contribution to tax revenues in the UK

The financial services sector as a whole made a total tax contribution of £53.4bn in 2009/10, representing 11.2% of total government tax receipts.  This figure includes taxes paid, as well as taxes collected, by the sector.  For London as a whole, the net contribution to the exchequer is estimated at £1.4bn in 2009/10 – below that achieved in earlier years as a result of the recession.  Forecasts suggest that over the medium term London’s net contribution should return to the levels seen prior to the financial crisis.
Sources:  PwC and City of London, Total Tax Contribution of UK Financial Services, December 2010  (528k). Oxford Economics and City of London, London’s Competitive Place in the UK and Global Economies, January 2011 (1140k)

The City as an international banking centre

The City is the largest international banking centre in the world, with banks in the UK accounting for over 20% of global cross-border banking business.  External lending by banks in the UK to foreign companies and other entities amounted to over $4.5 trillion in December 2010.  Total banking assets in the UK, at around £8 billion, are equivalent to more than five times the country’s total GDP.

Most of the world’s largest banks have chosen to locate key parts of their international business activities in London.   There are 241 foreign banks with branches or subsidiaries in the UK, more than in any other country.  The assets of foreign-owned banks in the UK are almost as large as those of the local UK-owned banks.  The Financial Services Authority maintains an updated list of all the banks authorised to do business in the UK.

According to a survey by the Association of Foreign Banks published in Spring 2011, the wholesale operations of foreign banks in the UK currently employ around 124,000 people, 40,000 of whom have a foreign passport.  Including their retail networks as well, foreign banks employ more than 160,000 people altogether.
Source:  Bank for International Settlements, June 2010

Payments clearing system in the UK

Although a large proportion of transactions in the UK are still made in cash and by cheque, a steadily increasing proportion takes place electronically.  As the use of cheques has declined, payments by plastic card have continued to increase.  The clearing process is overseen by the Association for Payment Clearing Services (APACS). Visit their website; http://www.ukpayments.org.uk/

Customer use of payment instruments in the UK

% of total of transactions   2005    2006    2007    2008    2009
Credit transfers   21.4    21.2    21.0    20.9    20.6
Direct Debits   19.6    19.8    19.9    20.2    19.8
Cheques   13.9    12.3    10.7      9.2      8.1
Card payments   45.1    46.6    48.4    49.8    51.5
Source: Bank for International Settlements ‘Red Book’, March 2011

For more detailed information, see City of London publication City Statshot – Payments and settlement systems

Foreign ownership in the financial sector

There are currently 1,117 firms in the financial services sector that are majority foreign owned.  Although 78 countries are represented in the UK finance industry, the majority of these firms are based in the USA.  Other important foreign interests in the UK financial services sector are from other European countries and increasingly from Asian countries.

Country No. of foreign owned financial
services companies in the UK
USA

548

Switzerland

67

Germany

57

France

53

Japan

42

Source:  IMAS

Foreign exchange business

The 2010 survey of currency trading conducted by the Bank for International Settlements shows that total turnover on markets worldwide has now reached $4.0 trillion a day.  Foreign exchange turnover in the UK reached more than $1.9 trillion on a daily basis, accounting for 36.7% of this global total.  In second place came the USA with a 17.9% share in turnover on world currency markets.         

Country Daily Turnover Share of Total
United Kingdom

$1,853.6bn

36.7%

United States

$904.4bn

17.9%

Japan

$312.3bn

6.2%

Singapore

$266bn

5.3%

Switzerland

$262.2bn

5.2%

Source: Bank for International Settlements, April 2010

The Bank for International Settlements conducts its survey once every three years.  Central banks conduct their own surveys on a more regular basis and these confirm the above results.  Foreign exchange surveys carried out by the Bank of England show that average daily turnover on UK foreign exchange markets stood at $1,821bn in October 2010, while the Federal Reserve’s figure for the United States was $771.8bn.

Stock exchange equity business

The London Stock Exchange currently has the fourth largest domestic equity market capitalisation in the world, after exchanges in the USA and Japan, but remains larger than those in other European countries and in Hong Kong and Shanghai.

Exchange US$ billion
NYSE Euronext

11,794

Tokyo Stock Exchange

3,277

NASDAQ OMX (US)

3,165

London Stock Exchange

2,407

NYSE Euronext (Europe)

2,295

Source:  World Federation of Exchanges, June 2010

Eurobond trading

London is the most active centre in the world when it comes to trading in Eurobonds, which are denominated in a number of currencies, but mainly in US dollars and euros.  New eurobonds and medium-term notes issued in London during 2010 were equivalent to £416.6bn, of which most were listed on the international market by foreign entities.         
Source: London Stock Exchange

Financial derivatives

The 2010 survey from the Bank for International Settlements also provides data on the worldwide market in financial derivatives.  Average daily turnover in interest rate derivatives has reached almost $2.7 trillion on a global basis.  The UK has the largest financial derivatives market, with an average daily turnover in interest rate derivatives of just over $1.4 trillion – equivalent to 45.8% of the total.

Interest rate derivative markets Daily turnover Share of total
United Kingdom

$123,4.9bn

45.8%

United States

$641.8bn

23.8%

France

$193.3bn

7.2%

Japan

$89.9bn

3.3%

Germany

$48.5bn

1.8%

Source:  Bank for International Settlements, April 2010

Exchange traded derivatives

The London International Financial Futures and Options Exchange (LIFFE), now part of NYSE Euronext, is one of the largest financial futures exchanges in the world.  Originally handling just financial futures transactions, such as interest rates, it has extended its range to cover futures trading in commodities as well.  In 2010 daily average transactions reached 2.8m by volume in 2010 and €1.27 trillion by value.

Source:  NYSE Euronext

Asset management

The UK has the largest asset management business in Europe, accounting for just under a third of the entire market calculated on a net asset basis.  As many as 24,000 people are employed in the UK’s asset management business.

Asset management markets

Total assets under management

Share of Total
United Kingdom

€3,181bn

29.5%

France

€2,554bn

23.7%

Germany

€1,327bn

12.3%

Italy

€562bn

5.2%

Source: European Fund and Asset Management Association, 2010

Figures published by the Investment Management Association place the figure for funds under management in the UK rather higher, at £3.9 trillion.

Insurance business

The insurance industry in the UK is the largest in Europe and the third largest in the world.  According to the Association of British Insurers it accounts for 8% of total worldwide premium income.  It also employs an estimated 275,000 people, or approximately a quarter of all financial services jobs.  Lloyd’s of London is the world’s leading insurance market, and has the capacity to insure complex and specialist risks.  It provides insurance to many of the world’s largest companies.
Sources: Association of British Insurers, UK Insurance – Key Facts, September 2010, and Lloyd’s Key Facts 2010

Shadow banking

Shadow banking is the term used to describe the activities of firms in the financial services sector but not operating as traditional banks.  This includes hedge funds, money market funds, commodity funds, private equity groups and securitised investment vehicles. According to data published by the Federal Reserve in the USA, the global balance sheet of the shadow banking sector is now larger than that of the traditional banks.

Regulation and financial sector firms

All firms that provide financial services to customers in the UK must be registered with the Financial Services Authority, as must members of staff holding senior management positions and advising customers. The FSA currently regulates approximately 29,000 firms and 165,000 individuals. Trends in the registration of firms and individuals in the financial services sector with the FSA is monitored on a quarterly basis by IMAS.
IMAS Publications

Charitable giving by City businesses

The financial and professional business services sector in total give an average of £505 million to community causes per year.
Source:  The Impact of City Businesses in Addressing Social Disadvantage (323k) (Oxford Economics) - City of London publication, November 2010

Trading between businesses in the City fringes and firms in the City

It is estimated that firms in the City of London procure £13.3 billion of goods and services per annum from suppliers, and it is estimated that 16% of the turnover of the average SME (small/medium sized enterprise) in the City fringes will come from sales to firms in the City of London.  Meanwhile, approximately 4 - 5% of the procurement needs of City of London firms by value are met by suppliers based in the City fringes.
Source:  The City of London’s Supply Chain and its Relationship with the City Fringes (778k) (CEBR) - City of London publication, September 2008

Key facts about the City of London

  • $1.9tr foreign exchange turnover each day in London. 37% global share, including foreign exchange derivatives (Source: Bank for International Settlements)
  • 19% of the global foreign equity market traded in London (TheCityUK)
  • 70% of global eurobond turnover traded in London (TheCityUK)
  • £200bn net premium insurance income in the UK (TheCityUK)
  • 120.3m metal contracts a year traded in London, with average daily turnover of $46bn (London Metal Exchange)
  • 1.293bn contracts a year traded on London's International Financial Futures Exchange (NYSE Liffe)
  • £4.1tr in funds under management in the UK (Investment Management Association)
  • £35.7bn trade surplus generated by the UK financial services sector (TheCityUK)
  • 46% share of 'over the counter' derivatives market (Bank for International Settlements)
  • 95% share of the EU emissions trading scheme (TheCityUK)
  • 604 foreign companies listed on the London Stock Exchange, including the AIM market (London Stock Exchange)
  • 241 foreign banks in London (TheCityUK)
  • 18% of cross-border lending arranged in the UK - more than any other country (TheCityUK)
  • 19% share of global hedge fund assets in the UK (TheCityUK) Leading western centre for Islamic finance, with 22 banks supplying Islamic financial services, five fully Sharia compliant (TheCityUK)
  • 21% share in 2009 of global market in marine insurance, making the UK the world leader (TheCityUK)

The City of London produces a number of quarterly periodicals:

City Economy Digest - Key macroeconomic indicators (both official and survey data), placing the financial and related business services sector in its context within the overall UK economy. It provides estimates of actual and forecast levels of economic activity in the City of London, aided by research from the consultancy Oxford Economics. Download copies of the City Economy Digest.

City Business Review - City Business Review complements City Economy Digest. It provides a broad overview of recent earnings announcements and developments by major financial and related business services firms present in London. Its primary focus is on banks, given their importance and regular, highly-detailed reporting of results. All major sub-sectors – insurance, legal services, accountancy, management consultancy, fund management, maritime services and financial market infrastructure – are covered, however, usually on an annual basis. Download copies of the City Business Review.

City Statshot – City Statshot provides a brief analysis of key topical issues affecting the City, including business and employment trends, based on a wide range of statistical sources. Download copies of the City Statshot.

If you would like to receive copies of our regular periodicals via email, please contact us at economic.research@cityoflondon.gov.uk.

The City Prospectus - the City's Local Economic Assessment

Local authorities have a statutory duty to prepare a Local Economic Assessment (LEA) for their area to ensure that they have an understanding of how economic conditions and forces shape local areas and to inform policies, priorities and the allocation of resources. The City Corporation has prepared a draft Local Economic Assessment for the City of London – entitled ‘The City Prospectus’ (1mb). This brings together in one document an assessment of the economic, environmental and population characteristics of the City of London (relative to Central London) as at summer 2010.  A number of key challenges for the City are also drawn out. 

 


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Last modified: 20 June 2011 | Author: Sahsine Suleyman
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