Report warns London could see 'lost decade' of employment with hard Brexit

The study was commissioned by the Mayor of London, Sadiq Khan

Report warns London could see 'lost decade' of employment with hard Brexit

A view of London Bridge as well as highrises in the finance district of London city | Image: Monika Skolimowska/dpa-Zentralbild/dpa

A new report has warned that up to 87,000 jobs are at risk in London if Britain walks away from EU negotiations without a Brexit deal.

The professional and financial services areas would be worst hit with some 119,000 fewer jobs nationally, according to the study from the Mayor of London Sadiq Khan.

It says there would also be 92,000 fewer jobs in the science and technology sector, 43,000 fewer jobs in construction and 27,000 less across the creative sector.

It also says that nearly stg£50bn (€56.4bn) worth of UK-wide investment could be lost by 2030.

The independent economic analysis was commissioned to examine a worst-case scenario.

It says a 'no deal' hard Brexit could lead to a "lost decade or longer" of significantly lower growth.

While softer Brexit scenarios - such as the UK remaining in the EU single market but leaving the customs union - could still see 176,000 fewer jobs across the country.

The report also shows that London could suffer much less from Brexit than the rest of the country - increasing "geographic inequalities" across the UK.

It says a future trade relationship must be agreed between the British government and the EU by October 27th this year.

Mr Khan is warning that with just 10 months to go, time is running out.

In total, five scenarios were modelled by Cambridge Econometrics to show a range of possible outcomes of the UK's future relationship with the EU.

These are:

  • Scenario 1 - A ‘close to status quo’ scenario where the UK remains part of both of the single market and customs union
    Scenario 2 - A scenario where the UK remains part of the single market, but not the customs union
    Scenario 3 - A scenario where the UK remains part of the customs union, but not the single market
    Scenario 4 - A hard Brexit scenario in which trade between the UK and the EU falls under World Trade Organisation (WTO) rules with a two-year transition period from March 2019
    Scenario 5 - The same hard Brexit scenario but without a two-year transition period

Commenting on the report, Mr Khan said: "I've released these impact assessments because the British people and our businesses have a right to know the likely impact on their lives and personal finances.

"This new analysis shows why the government should now change its approach and negotiate a deal that enables us to remain in both the single market and the customs union."

Read the full report here