Keeping London at the forefront of global business
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We mustn’t kid ourselves: challenge lies ahead
22 May 2019
New research from Centre for London shows that the capital’s popularity as a location of choice for international headquarters remains undiminished. More than that, it has intensified over the last 10 years. But with Brexit on the horizon, we must not stand still or take that trend for granted.
London remains a top destination for multinational HQs, attracting more investment projects than other global city, including Singapore, Dubai, Hong Kong, Dublin and Paris. And in many ways, that isn’t surprising. London is home to six million jobs – alongside its world-class theatre, dance, art and museums. It houses over 180 business accelerators and incubators – alongside its eight million trees, 150 parks and four UNESCO world heritage sites. More than 230 languages are spoken inside the M25. And when it comes to attraction, liveability and talent, London has a lot going for it.
But we mustn’t kid ourselves. Those competitors will be eyeing up our spot and vying for a greater slice of the pie. Although not every decision to move an HQ, now or in the future, is a significant cause for concern, there is a real risk that even the perception of Brexit could somehow diminish our influence, create uncertainty on whether to invest and lead to a weakening of UK prestige.
We must act now to counter that, taking bold steps to boost London’s competitiveness for the future. Our own report, London in 2036, clearly identified the critical role of transport and infrastructure in getting this right. People need to be able to access the city. HQ staff need attractive and affordable places to live. And beyond physical infrastructure, Londoners need to have the right skills to make the talent pool a draw.
Plans to make our city easier to access and move around must be expedited and delivered. There are 1.35 billion tube journeys a year, 2.2 billion bus journeys and 2 million car users in London. With so many people continuous flowing across the city, rapid delivery of our infrastructure projects is the name of the game. Crossrail 1 must open as soon as possible in 2020. HS2 must be completed. The Bakerloo line must be extended. Crossrail 2 must be delivered. We need innovative approaches to congestion and environmental road charges. We must crack on with building another runway at Heathrow and with improving the connections to all of London’s airports. None of this is optional if we are to have the same appeal to HQs in the future as today.
On housing, there is no single, simple solution to tackling the crisis. We can be the whizziest, most innovative, most desirable city in the world. But if people can’t afford to live here then London is on borrowed time. Alongside more land being made available and more investment coming forward, we need to use the land we have more creatively. We need to embrace good quality, well-designed, high density housing. We need to build across our rooftops – think of Parisian-style mansion blocks and build in more modern ways to speed up delivery. This demands more money from government, ambition from the Mayor, flexibility from the boroughs and innovation from the industry. The four pieces of the jigsaw, all equally vital if London is to house the talent of the future.
And finally, we can only remain an attractive place to do business if we have the skills international companies are looking for. Skills gaps still exist, particularly when it comes to digital expertise, which is increasingly important as data and algorithms become the new steel and oil. We can’t turn off the tap of talent from overseas but at the same time, we need to provide the best education and training for people who already live here.
London leads the world and is a petri dish of talent, innovation and diversity, so it is no wonder HQs choose the capital as their home. But if we are to retain that place in the world, we must invest now, otherwise our international stature will diminish and it’ll be too late to go back and change course.
Where next for our capital? George Osborne will lead the debate at London Summer Business Lunch, 25 June at Westminster Abbey. Book your place.
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