SCOTLAND’s financial industry has outperformed London’s in the job creation stakes according to a report which underlines the key part the sector plays in the economy.
Industry body TheCityUK found the number of people employed in the financial and related professional services industries in Scotland grew by 10,000, to 161,000, in 2016.
This resulted in a 6.6 per cent increase in workforce numbers. The growth rate comfortably outpaced the 5% recorded in London, which regards itself as the capital of the global financial services industry.
Read more: Banking giant HSBC to create 500 jobs in Scotland
The findings provide further evidence Scotland is overcoming the devastation caused by the financial crisis of 2008, which took a heavy toll on the country’s banking sector.
However, the numbers employed in the industry in Scotland in 2016 were still 5,000 lower than in 2009.
Financial and related professional services firms generated £12 billion for the Scottish economy in 2016, representing 8.9% of total output. The value was around £100m up on 2009.
TheCityUK reckons Scotland still has particular strengths in banking and in the pensions and life assurance industries, in which it has been a leading force since the nineteenth century.
Read more: 300 jobs to be created in Glasgow by professional services firm
The report highlights the range of financial services activity in other fields such as investment management and asset servicing.
TheCItyUK has provided a vote of confidence in Scotland’s ability to cope as advances in financial technology (FinTech) allow newcomers to take on established players.It said the country is rapidly becoming a global leader in FinTech.
Nicola Sturgeon said the report reinforced Scotland’s position as the UK’s leading financial services hub outside London.
“Scotland offers a combination of a well-established financial services sector and ongoing innovation, with many global companies already based here,” said the First Minister.
TheCityUK said the report did not attempt to offer a view on the impact of Brexit on the UK regions and nations.
Read more: Edinburgh thrives as it defies fallout from financial crisis
However, it noted the UK is the world’s leading exporter of financial services, with the financial and related professional services industries generating a trade surplus of £80.5bn.
The UK must create a flexible and dynamic immigration system which enables access to international talent.
Minister and officials need to ensure the business environment is supportive across the UK.
Miles Celic, chief executive of TheCityUK, said one in every 14 British jobs are in financial and related professional services.
The report found Edinburgh is the largest financial services centre outside London with around 53,000 jobs in the sector. The city has a strong presence in banking, life insurance and investment management activities.
Some 40,500 people work in the sector in Glasgow, which has strengths in general insurance, asset administration, legal services and accountancy.
Large numbers are employed in Aberdeen, Perth and Stirling.
Financial services firms have created jobs in Scotland in recent months.
In June last year HSBC bank announced plans to create500 jobs in Scottish operations including its global risk and compliance base in Edinburgh.
Swiss private bank Julius Baer International opened a wealth management office in Edinburgh in May.
Edinburgh-based Nucleus Financial has grown employee numbers by around 20%, to 200, since 2016.
Last month the new head of Europe, the Middle East and Africa (EMEA) for Morgan Stanley signalled her expectation of its Glasgow base winning more work from the US investment bank’s global functions.
Sector players generated £174bn for the UK economy in 2016. They provided 2.3 million jobs, including 0.8m in London.
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