More than half of London’s financial services firms have concrete plans to reduce office space in the wake of the Covid-19 pandemic, according to a survey conducted by the Confederation of British Industry (CBI).
Of more than 130 financial services companies asked, 57% said they are cutting office space, while nearly three-quarters said they were at least reviewing how much space they require.
The research, carried out jointly between the CBI and professional services giant PwC, suggests that despite a handful of high-profile deals still going ahead in London’s prime office market in recent months, the way City firms use the workplace is still set for dramatic change.
Further findings included 43% of firms saying that at least nine in 10 of their employees can work remotely, while only 27% said they consider around two-thirds of their office space “essential”.
This comes after months of varied predictions around the future of the office, as UK firms find themselves pushed back into lockdown for much of the opening quarter of 2021.
Last week, Cushman & Wakefield president John Forrester predicted that wholesale moves towards remote working were premature. “Most companies now think that at some point the vast majority of workers will come to the office a number of times a week,” he told EG.
The figures formed part of a wider quarterly survey carried out by the CBI on the financial services sector, which found that business volumes had grown in the three months to December for the first time since September 2018, and at the fastest pace since June 2017.
However, the survey, which was conducted before the January lockdown, also suggested that employment had dropped for the fourth consecutive quarter in the sector, with a balance of -20% of firms saying they had reduced headcount.
Rain Newton-Smith, CBI’s chief economist, said: “The first step to supporting financial services firms is to ensure businesses across the economy can survive to fuel the recovery.
“Immediate support includes extending the job retention scheme to the end of Q2, along with reviewing targeted help on business rates and VAT.”
To send feedback, e-mail alex.daniel@egi.co.uk or tweet @alexmdaniel or @estatesgazette
