The Find: London has climbed its way up the league table to become a top city for business, but a new study reveals that the Big Smoke may be losing its hard-won place at the top.- The Source: The latest CBI/KPMG London Business Survey of senior executives at more than 100 UK businesses.
The Takeaway: Pessimism about the future of London is rife among business leaders. Six out of ten executives fear the city’s competitiveness is threatened — that’s double the number of respondents who were worried last year. What’s got these business leaders so concerned?
- Bungled taxation reforms
- Financing troubles due to the credit crunch
- The creaky road and subway (or should I say, tube) network
- A shortage of skilled workers
Eight out of ten executives thought that the tax reforms, which include a £30,000 fee for non-doms who opt out of paying UK taxes on overseas income, have damaged the reputation of the UK as an international business destination. That’s a pretty strong consensus, but even more managers agreed that the unreliable and overcrowded tube network was a significant negative for London. Nine out of ten said that the poor state of public transport was affecting their businesses.
Almost a third of managers (31 percent) surveyed said they expect to have trouble raising money over the next six months, up a full nine percent from a year ago. Filling skilled positions was also a concern. 72 percent of executives said they were unable to fill some vacancies, though there is some optimism that a new migrant points system will help.
All in all both the volume and value of business activity is still growing in the UK capital, but at a slower rate, and while five percent of business people were pessimistic about their firms’ prospects a year ago, 28 percent are today. CBI director-general, Richard Lambert, sums it up: “business is getting more difficult in London, partly because of the global economic slowdown but also the more particular problems of transport and skills.”
The Question: Now that’s its gone international BNET can ask, what’s the best city for business in the world? And what could your city do to be more business friendly?
