Finance Jobs Hurt By Brexit
When countries sign up for the European Union, they gain access to a “single market.” Members can freely exchange goods and services without the usual hassle of crossing borders. By leaving the European Union, Britain will put the borders back up and make international business much more complicated. Thanks to Brexit, finance jobs in particular are fleeing Britain and to the safety of major EU cities.
The Great Bank Exodus
Many banks have set their sights on Frankfurt in central Germany. Dublin and Paris are other strong contenders. Plans won’t be finalized until Brexit officially occurs, but London workers have good reason to be nervous as banks check out foreign locales. At the moment their biggest concerns are figuring out the logistics and making their commitment to the European Union clear. After acquiring the proper licenses and infrastructure, the next step is to develop a strategy for doing business in their new home.
The exact number of finance jobs moving will fluctuate until Brexit activity finalizes. No matter how it pans out, London’s economy won’t emerge unscathed. Banks only make up two percent of London’s finance jobs, but bankers typically have high salaries and pay more taxes. The remaining population might have to shoulder the burden of Brexit. On the other hand, some British politicians claim the Brexit impact has been exaggerated. Regardless about 10,000 jobs will leave the country.
Which Banks are Making the Move?
Banks have been announcing status updates along with tentative total number of finance jobs moving. Recently JP Morgan announced their plan to move 60 client-facing employees and some corporate personnel to Paris. In addition, they acquired a new building in Dublin that can accommodate 1,000 employees. At the same time they’re looking to build a global operations center in Warsaw, Poland.
Meanwhile, Bank of America will relocate its legal headquarters to Dublin and also expand in Paris to cope with Brexit. Citigroup hopes to do business in France, create new headquarters in Frankfurt and relocate some of its private banking unit to Madrid in Spain. Goldman Sachs aims to shift 1,000 staff members to Frankfurt. Morgan Stanley might follow their lead though they’re also considering Dublin. HSBC will spend up to $300 million shipping 1,000 finance jobs and other aspects of its business to Paris. As of this writing Deutsche Bank will have the most drastic impact on London. Their plan involves moving 4,000 jobs to Frankfurt and other EU locations.