New research launched today by PwC shows that industries such as manufacturing could see a combined surge of nearly 100,000 new jobs by 2020 if the UK financial services sector is supported by sustainable and well regulated growth. The net result could lead to 17,000 new construction jobs.
PwC economists behind the new report, report, “Model Behaviour – the present and future of FS services in the UK”, depict two scenarios which could impact on job creation for the country. The first is based on a GDP rise of 2-3%, which would create up to 218,000 jobs across all industries. The second is based on a weaker contribution of the FS sector and a rise of just 0.2% in GDP which would see only 12,000 jobs created, including and outside of, financial services.
Scenario 1: is a vision for the future with a growing financial services sector. This is supported by a robust, but supportive, regulatory regime and economic and market conditions that are also beneficial to the financial services sector. The sector grows at a substantial, but more sustainable rate before the 2007 crises.
Scenario 2: provides an alternative view of the financial services sector which is constrained by weaker economic and market conditions both domestically and globally, as well as a regulatory environment that does less to facilitate growth than that specified in scenario 1.
Chris Temple, UK Head of Engineering & Construction PwC, commented: “Our new research shows the fundamental link between growth in GDP and job creation in our core industries and the important role confidence has in securing that success. There is no doubt that areas such as manufacturing and construction were among the worst hit in the recession when confidence was at an all-time low.
“If we start to see the investment that we really need in these sectors then we can expect to see scenario one become a reality as business leaders will be able to secure the finance that they require to grow – and this in turn will boost confidence.
“The challenge for policymakers is the provision of effective UK and EU regulation that limits the likelihood and impact of any future crises, while allowing both the financial services sector and the wider economy to prosper.”