Booming capital outstrips rest of UK
A buoyant service sector propelled London's economic growth to its fastest for 14 months in March, a new survey shows today.
The latest snapshot of the capital's economy from Royal Bank of Scotland (RBS) reveals growth outstripping the national average, a flood of new orders and rising employment. However, London's manufacturers are struggling like those in the rest of the country and factory output dipped.
The survey's headline business activity index registered 60.4, the highest since January last year. The UK reading was 55.8. However, fierce competition means firms are unable to pass on higher costs, keeping price rises under control.
RBS economist Ross Walker said: "Rapidly expanding order books and rising backlogs of work suggest further robust growth will be recorded in future months, resulting in continued expansion of the private sector workforce.'
Meanwhile, a separate report predicted City jobs will be back to dot-com boom levels next year. The Centre for Economics and Business Research has upped its forecast for annual employment growth in the Square Mile over the next four years from 1.5% to 1.8%.
Some 4500 City jobs will be created over the next year, taking the total to 325,500. By 2009, the number will have risen to 340,000.
The fund management, corporate finance and securities sectors will be the most aggressive hirers this year, and professional services, insurance and international banking next year.
