London may be the centre of the investment banking universe in Europe, employing some 358,000 people in City-type functions, but within the EU Germany employs the most financial and professional services professionals.
A quick snapshot of EU financial services employment, handily distilled into the infographic below by CityUK, demonstrates the UK’s reliance on financial services employers. 7% of the UK workforce are in a finance or professional services position. The UK ranks third in Europe – behind Luxembourg (19%) and Cyprus (9.8%).
Across the UK, 2.1m people are in finance and professional services jobs, compared to 2.2m in Germany.
This may make Germany sound appealing. Unfortunately, most of those German financial services jobs involve retail banking or insurance. The high-end banking jobs are predominantly in Frankfurt (where 73,000 finance professionals work) and the high-end asset management jobs are predominantly in Munich.
In the late-1990s, as Deutsche Bank and Dresdner talked of shifted their investment banking operations to Germany, Frankfurt was heralded as a real competitor to London, but obviously this never happened. However, if Britain were to leave the EU, numerous banks including Goldman Sachs could flee the UK’s shores, enfeebling the City and potentially allowing Frankfurt to benefit.
Frankfurt does have one thing going for it right now, however – stability. Between the peak of 2008 and the first quarter of 2013, headcount in Frankfurt dropped by just 2%, or 2,500 people, according to recent figures from Helaba Research. In London, employment dropped by 30% in the financial sector over the same period, according to the CEBR.
There are currently two leading financial centres in terms of employment in Europe, though – London, which employs 358,000 people in finance and Paris, where headcount is around 270,000, says CityUK.