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This paper provides information on the economic output of the financial services sector and international comparisons; the number of jobs in the sector; statistics on the sector’s exports and imports; and the amount of tax it contributes to the Exchequer.

In 2020, the financial services sector contributed £164.8 billion to the UK economy, 8.6% of total economic output. The sector was largest in London, where half of the sector’s output was generated.

The UK financial services sector was the third largest in the OECD in 2020 by its proportion of national economic output. Luxembourg’s financial service sector was the largest in the OECD, contributing 25% of the country’s economic output.

There were 1.1 million financial services jobs in the UK in Q1 2021, 3.3% of all jobs.

Exports of UK financial services were worth £62 billion in 2020 and imports were worth £16 billion, so there was a surplus in financial services trade of £46 billion.

35% of financial services exports went to the EU and 31% of financial services imports came from the EU.

Future of the UK financial services sector

A twice-yearly ranking of the competitiveness of financial markets compiled by a City of London and a China-based think tank ranked London second in the world (narrowly behind New York) in September 2021. Edinburgh was ranked 22nd, down from 13th in September 2020.

The data so far suggests that jobs and business has been lost to other financial centres as a result of the UK leaving the European single market, but the impact may not be as big as initially feared by some. Our briefing The UK-EU trade deal: financial services discusses the UK-EU trade deal’s provisions on financial services and its impact.

The Government has embarked on far-reaching reform of financial services regulation with the aims of increasing competitiveness and taking advantage of newly-obtained freedoms to shape regulation after leaving the EU. Agreements have been negotiated with countries including Japan, Singapore, Switzerland and Australia as well as Norway, Iceland and Liechtenstein which contain provisions on financial services and which the Government believes will help boost UK financial services exports.

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