Just how important is financial services to the UK economy?

It’s no secret that financial services make up a big chunk of the UK’s economy. But just how big exactly?

A new parliamentary briefing paper reveals how much financial services contribute to our prosperity, how many people are employed in the sector and how much we export to other countries.

In 2018, the financial services sector’s total output was £132 billion, equivalent to 6.9% of total output.

However, while that is a fair proportion, the sector’s importance to the wider economy has dwindled since it’s 2009 peak, when it accounted for 9.2% of total output.

In fact, the last time financial services made up a smaller proportion of the UK economy was in 2004, according to the paper.

Unsurprisingly, London, as one of the world’s leading financial centres, accounts for the lion’s share of our financial services industry, generating 49% of its output.

The number of jobs in the financial services sector has remained broadly level over the past 20 years. Presently, it employs more than 1.1 million people in the UK, which accounts for 3.1% of all jobs.

Of these 1.1 million, the highest concentration is in London and the South East, which account for a combined 520,000 roles – or nearly half of the jobs in the sector.

The UK’s financial and insurance exports exceed imports by £44 billion, with total exports of nearly £60 billion.

If you want to read more about the sector’s contribution to the UK economy, click here.