London might assist generate an extra £76 billion a 12 months for the UK economic system by 2030 if productiveness development in finance, expertise, and science and analysis industries is accelerated, in line with a brand new report from PwC. The consultancy’s Develop London report argues that the capital is properly positioned to assist development in what it describes as “frontier industries” resulting from its focus of expert employees, entry to funding, established expertise clusters and secure enterprise surroundings.
PwC estimates that stronger productiveness development in these sectors might contribute an extra £40 billion in annual gross worth added (GVA) inside London by 2030, with wider financial results rising the UK-wide determine to £76 billion. The report compares London with 11 worldwide peer cities and concludes that it stays one of many strongest areas globally for creating high-productivity industries.
In line with the evaluation, London continues to draw extremely expert employees by way of its universities and employment alternatives. The report notes a development in technology-related examine programmes and a 15 p.c improve in employees with expertise linked to frontier industries.
London additionally stays a big centre for funding. PwC discovered that the capital ranks second solely to New York among the many cities assessed for enterprise capital market maturity. Since 2019, synthetic intelligence and monetary expertise corporations have accounted for 60 p.c of enterprise capital offers accomplished in London, representing greater than 7,000 transactions.
The report additionally highlights London’s innovation ecosystem. Among the many cities analysed, London ranks second solely to Tokyo for AI patents per million employees. It additionally performs strongly for institutional stability and low ranges of corruption, in line with the IESE Cities in Movement index.
Simon Oates, UK economics chief at PwC, mentioned that discussions about regional financial growth mustn’t overlook London’s function in supporting development throughout the nation. “Because the UK rightly takes steps to degree up its areas, it has grow to be virtually retro to speak confidently about London,” he mentioned. “Nevertheless, the truth is {that a} affluent capital creates vital financial spillover results that, in flip, generate payoffs from Caithness to Cornwall.”
The report identifies a number of priorities for companies. These embrace serving to workers develop the talents wanted to work alongside AI applied sciences, making larger use of innovation clusters equivalent to Camden’s Information Quarter and the Metropolis of London’s fintech sector, and adopting AI instruments in a extra focused and strategic approach.
PwC argues that coverage interventions may even be required. These embrace addressing power prices, bettering entry to growth-stage finance, rising housing affordability and strengthening pathways from training into employment, significantly for younger people who find themselves not presently in training, employment or coaching.
Quentin Cole, London market chief at PwC UK, mentioned the capital has the foundations wanted to drive a brand new section of productiveness development, however that additional motion is required from each companies and policymakers to grasp its potential.
