London's largest industry is finance, and its financial exports make it a large contributor to the UK's balance of payments. Around 325,000 people were employed in financial services in London until mid-2007. London has over 480 overseas banks, more than any other city in the world. Currently, over 85% (3.2 million) of the employed population of greater London works in the services industries. Due to its prominent global role, London's economy has been affected by the late-2000s financial crisis. The City of London estimates that 70,000 jobs in finance will be cut within a year. The City of London is home to the Bank of England, London Stock Exchange, and Lloyd's of London insurance market.
Over half of the UK's top 100 listed companies (the FTSE 100) and over 100 of Europe's 500 largest companies are headquartered in Central London. Over 70 per cent of the FTSE 100 are located within London's metropolitan area, and 75 per cent of Fortune 500 companies have offices in London.
Along with professional services, media companies are concentrated in London and the media distribution industry is London's second most competitive sector. The BBC is a significant employer, while other broadcasters also have headquarters around the City. Many national newspapers are edited in London. London is a major retail centre and in 2010 had the highest non-food retail sales of any city in the world, with a total spend of around £64.2 billion. The Port of London is the second-largest in the United Kingdom, handling 45 million tonnes of cargo each year.
London has five major business districts: the City, Westminster, Canary Wharf, Camden & Islington and Lambeth & Southwark. One way to get an idea of their relative importance is to look at relative amounts of office space: Greater London had 26,721,000 m2 of office space in 2001, and the City contains the most space, with over 7.7 million m2 of office space.
Service industries
London shifted to a mostly service-based economy earlier than other European cities, particularly following the Second World War. London's success as a service industry and business centre can be attributed to a large array of factors:
English being the native language and the dominant international language of business
its former position as the capital of the British Empire
its location within the European Union
the special relationship between the United Kingdom and United States and the United Kingdom's close historical relationships with many countries in Asia, Africa and the Middle East
its location in a central time zone that allows it to act as a bridge between US and Asian markets
English law being the most important and most used contract law in international business
relatively low taxes, particularly for foreigners - non-UK domiciled residents do not get taxed on their foreign earnings
a business friendly environment (e.g. in the City of London the local government is not elected by the resident population but instead by business - the City of London is a business democracy)
good transport infrastructure particularly its aviation industry
Currently, over 85% (3.2 million) of the employed population of greater London works in the service industries. Another half a million employees resident in Greater London work in manufacturing and construction, almost equally divided between both.
London has five major business districts: the City, Westminster, Canary Wharf, Camden & Islington and Lambeth & Southwark. One way to get an idea of their relative importance is to look at relative amounts of office space: Greater London had 26,721,000 m2 of office space in 2001.
A useful guide to the distribution of wealth across London is the cost of renting office space. Mayfair and St. James's are currently the most expensive areas - approximately £93.00 per sq ft per annum.
London's largest industry remains finance, and its financial exports make it a large contributor to the UK's balance of payments. The City is home to banks, brokers, insurers and legal and accounting firms. A second financial district has developed at Canary Wharf to the east of the City, which includes the global headquarters of two of the world's largest banks, HSBC and Barclays, the rest-of-the-world headquarters of Citigroup and the headquarters of the global news service Reuters. London handled 31% of global currency transactions in 2005 — an average daily turnover of US$753 billion — with more US dollars traded in London than New York, and more Euros traded than in every other city in Europe combined.
More than half of the UK's top 100 listed companies (the FTSE 100) and over 100 of Europe's 500 largest companies are headquartered in central London. Over 70% of the FTSE 100 are located within London's metropolitan area, and 75% of Fortune 500 companies have offices in London. London is also the headquarters for four of the world's six largest law firms.
Along with professional services, media companies are concentrated in London (see Media in London) and the media distribution industry is London's second most competitive sector. The BBC is a key employer, other broadcasters also have headquarters around the city. Many national newspapers are edited in London, having traditionally been associated with Fleet Street in the City, they are now dispersed across the capital. Soho is the centre of London's post-production industry.
Tourism is one of London's prime industries, and London is, by a considerable margin, the most visited city in the world by international tourists, with 15.6 million international visitors in 2006, ahead of second placed Bangkok (10.4 million international visitors) and third placed Paris (9.7 million). Tourism employed the equivalent of 350,000 full-time workers in London in 2003, whilst annual expenditure by tourists is around £15bn.
Transport
Once the largest port in the world, the Port of London is today the second-largest in the United Kingdom, handling 48 million tonnes of cargo each year. Much of this passes through the Tilbury, outside the boundary of Greater London.
Artist's impression of the London skyline in 2012
Manufacturing and construction
Another half a million employees resident in Greater London work in manufacturing and construction, almost equally divided between both.
For the 19th and much of the 20th centuries London was a major manufacturing centre (see Manufacturing in London), with over 1.5 million industrial workers in 1960. Manufacturing suffered dramatic decline from the 1960s on. Entire industries have been lost including shipbuilding (which ended in 1912 after hundreds of years with the closure of the Thames Ironworks and Shipbuilding Company), consumer electronics, aircraft manufacture and most of the vehicle construction industry. This trend continues, with the loss of the pharmaceutical manufacturing sites of Aesica (formerly Merck Sharp and Dohme) at Ponders End in 2011 and Sanofi-Aventis (originally May & Baker) at Dagenham by 2013.
Today one of the last substantial industrial plants remaining is Ford Dagenham, a major producer of body panels and the largest diesel engine manufacturing site in the world. Food and drink manufacture remain in places, for example baking at Warburtons in Brimsdown, brewing at Fuller's Brewery in Chiswick, manufacture of coffee and chocolate by Nestlé in Hayes, and refining of sugar and syrup by Tate & Lyle in Silvertown. At 2.8%, London was the region containing the lowest proportion of employees engaged in UK manufacturing.
All About London
- London
- Demography of London
- Religion in London
- Sport in London
- Culture of London
- Education in London
- Tourism in London
- Transport in London
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