Bad Brexit deal 'Cardiff jobs risk'

By Brian Meechan
BBC Wales business correspondent

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Image source, tattywelshie/Getty Images
Image caption,
The services sector in Cardiff is worth £1.1bn in exports

Cardiff is one of the most vulnerable cities in the UK to a bad Brexit deal for the financial services sector, according to the Centre for Cities think-tank.

More than half of all exports from Cardiff are based around finance as the city's manufacturing sector is limited.

Swansea and Newport are also vulnerable although finance accounts for 15% and 16% of their exports respectively.

Edinburgh tops the table, followed by Cardiff.

When the financial sector's share of services exports is looked at in the report London Links, it is the highest in Cardiff (81%), followed by Northampton (76%) and Leeds (71%).

Andrew Carter, chief executive of Centre for Cities, said: "Financial and professional services play an important role in the economies of Welsh cities, accounting for tens of thousands of jobs and a high share of their exports.

"Given that Cardiff, Newport and Swansea make up over half of the Welsh economy, it's clear that a bad Brexit deal for services will have big implications across the country."

He said the UK government had outlined its plans to take services out of the EU single market but it "should not underestimate the damaging impact" that this could have on jobs and wages in Welsh cities and across the UK."

Image source, tattywelshie/Getty Images

Stronger London links, higher-skilled jobs

Aldershot, Brighton, Bristol, Cambridge, Cardiff, Edinburgh, Glasgow, Leeds, Milton Keynes, Norwich, Reading, Southampton, York

Stronger London links, lower-skilled jobs

Birmingham, Coventry, Crawley, Gloucester, Luton, Manchester, Middlesbrough, Northampton, Plymouth, Sheffield, Slough, Sunderland, Swindon, Telford

Weaker London links, higher-skilled jobs

Aberdeen, Bournemouth, Exeter, Oxford

Weaker London links, lower-skilled jobs

Barnsley, Basildon, Birkenhead, Blackburn, Blackpool, Chatham, Derby, Doncaster, Dundee, Huddersfield, Hull, Ipswich, Leicester, Liverpool, Mansfield, Newport, Peterborough, Portsmouth, Preston, Southend, Stoke, Swansea, Wakefield, Warrington, Wigan, Worthing.

Source: Centre for Cities

So far much of the focus on what a deal will look like for financial services has concentrated on the impact on London.

However, Cardiff's identified as having a sector that has strong links to London and it provides highly-skilled jobs.

Swansea and Newport's links to London are much weaker and the skill levels of those in the industry are lower.

In recent years, the Welsh Government has made increasing the number of jobs in financial and professional services in Wales a priority and companies like Deloitte have increased their presence here.

Chris Nott, a senior partner at Capital Law, a member of the Welsh government's advisory panel on the economy and a former chair of the financial services sector panel, said: "It's reassuring to hear, again, that Cardiff is one of the leading cities in the UK for financial and professional services, with high value jobs closely connected to London based organisations.

"Financial and professional services jobs also have the highest value of any sector in the Welsh economy.

"The Welsh Government has been working hard to help build this part of the economy. This does, though, make us vulnerable to the effect of those organisations rebasing themselves elsewhere in the EU because of Brexit, as many are doing - some publicly and some 'below the radar'.

"Brexit will not be good for financial and professional services".

Economy Secretary Ken Skates said there was "no doubt" that a hard Brexit, in which the UK crashed out of the EU without a deal, was likely to impact badly on our financial services sector.

"That is one reason why we are continuing to press the UK Government for a Brexit that protects our jobs and the economy, retains full and unfettered access to the single market and includes participation in a customs union," he said.

A UK Government spokesman said: "We are committed to securing a deal on financial services that works for the entire United Kingdom, including Wales."

In the EU referendum, Wales voted leave by 52.5% compared with 47.5% for remain.

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