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“Many more jobs will be lost than we’d previously thought”

Until not too long ago, the Centre for Economics and Business Research (CEBR) was predicting the disappearance of 20,000 jobs from the City. But it’s now had a sudden and dramatic change of heart. After further consideration, it now thinks 62,000 jobs will go in total: 28,000 in 2008 and 34,000 in 2009.

The message is clear: not only are things far, far worse than we’d thought, but they’re going to get worse still, not better.

This isn’t the first time that the CEBR has had to revise its forecasts. Until last April, it was forecasting a total of 15,000 City job losses this year and next. But the latest leap is of a far different magnitude.

The elimination of 62k jobs will apparently take the City back to employment levels previously seen following the Russian crisis in 1998. It also puts the City at the forefront of banking job losses globally: according to Bloomberg, 130,000 banking jobs have been lost in total since the crisis began.

Put into perspective, however, the CEBR’s predictions – although dire – are not as dire as they could be. It expects fewer than 20% of staff to go, with total City employment predicted to fall from 353,000 in 2007 to 291,000 in 2009. Most banks have seen revenues plummet 40% or more.

The CEBR also thinks some business areas will be less impacted than others. From 2007 to 2009, fund management, equities and professional services are expected to escape with staff cuts of 16%, 15% and 16% respectively.

Over the same period, derivatives and FX jobs (one category) are expected to fall 33% and corporate finance jobs are expected to fall 54%. Corp finance jobs have been relatively unaffected so far, but the CEBR is predicting a bloodbath unless M&A activity picks up very soon.

Comments (11)

  1. To quote a movie that came out this spring:

    There Will Be Blood.

  2. The Thames will run red with blood……

  3. Good news, and I hope there are many more to come. There are STILL far too many sub-standard, dead weight, mediocre people in this industry, let the credit crunch clean them out!

  4. I can believe almost any number of people fired in the next couple of years that they care to dream up.
    But that’s not the same as jobs lost…
    Certainly it won’t be good times even slightly, but CEBR has made some strong assumptions, including the one that most banking employment will be in large firms, most of which are suffering horribly.

    My take is that smaller firms will move into areas that the larger firms are not able to to dominate any more. They will take up some of the slack, though I can’t predict quite what %

  5. We shouldn’t always use the metapher of blood and pain in this crises. That makes things appear worse than they are.
    Actually, where is the spirit of the City? Where are the people who see in chaos the opportunities? We need more fundamental optimism!

    The sky is the limit. Get used to it!

  6. Have to agree with Henry again!

    Sorry guys!

  7. Yes, Henry you are right. Survival of the fittest. There are far too many people in the industry who do it for money rather than love. Buying that porsche will not help you. You will still be a geek, you just won’t have the excuse that the reason no-one likes you is because you are poor.

  8. About optimism. Any opportunities will probably be picked up by ambitious foreigners! Most people in the City are just office ‘grunts’ or working stiffs as the Americans call them.

    The sky’s not the limit if you’ve been in employment for a ten-year period and have convinced yourself that you’re part of the affluent set. Only a tiny proportion of the population is rich. Topping up a 40K salary with easy credit isn’t rich – just living well.

    The dream is over – yet another quote, from a song this time!

  9. Henry, I have to agreed with you too many people sitting comfortable in their jobs that do not belong there. Its about time the Industry get rid of them.

    The City is for people who seriously understand the impact of Accounting/Finance/Investment not for people who constantly dreams of dollar signs. We don’t need logger heads

    Nice one Guys, do hope that your jobs are all safe. You all seems like a sensible bunch.

  10. it is not the industry that will get rid of the people but regulation that is going to clean out the people AND clean up the industry

  11. it is good old Henry again. Mr Managing Associate. hello again!

    and we truly appreciate this deeply intelligent comment.. everybody does. the Henry machine. his thoughts are coming up once he is searchning the ads, full of bitterness.

    But I am sure one day, Henry willbecome a man who is truly able to move things forward.

    keep it up Henry and someday where will be a spot for you – small one though.

    hanging in there Reply

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