London is a world-leading, global city, its reputation acting as a magnet for people and businesses. Such are the latest findings from the London Tomorrow: Shaping Future Cities thought leadership initiative. But that isn’t the full story. A rising affordability crisis is putting this reputation at risk. Unaffordable housing, high transport costs and expensive office space are factors that risk making the capital a less attractive place to set up and run a business, and make a home.
Sixty nine per cent of London councillors and 48 per cent of both Londoners and London businesses polled for London Tomorrow cited the insufficient availability of homes as one of the biggest barriers to London’s future economic competitiveness. Almost half of businesses felt that the high cost of commercial space in the capital was a major barrier and 39 per cent of Londoners, 41 per cent of businesses and 34 per cent of councillors highlighted London’s transport costs.
According to 62 per cent of London businesses polled, the biggest challenge facing new businesses setting up in the capital was the price of commercial and office space. These findings correlate with those by Tech London Advocates which found that 26 per cent of London technology companies they surveyed had considered relocating outside the city as rents rise. Colin Stanbridge, LCCI chief executive, noted that whilst London is a phenomenal success story, “our city is fast becoming an unaffordable place to set up shop and live. We must act quickly to ensure that London’s world-leading reputation isn’t eroded”.
The research set the context for the latest London Tomorrow thought leadership event held at the Guildhall, in the City of London, and facilitated by Tim Donovan (pictured, right), BBC London’s political editor. Organised by
the LCCI, in association with EY and supported by London City Airport, London Tomorrow brings together a panel of leading public policy and business figures to discuss the challenges posed by London’s increasing population. Each discussion has been underpinned by research from leading UK polling company ComRes who survey the London public, business and civic leader opinion.
At The Guildhall, the focus was on how London can remain a competitive, entrepreneurial city in the face of the latest ComRes findings, in particular those highlighting affordability pressures. Panellists Caroline Artis, senior London partner at EY, James Ashton, executive editor at the London Evening Standard, Jeremy Probert from London City Airport, Vicky Pryce, economist at CEBR, Kulveer Ranger, former advisor to the Mayor of London and Professor Tony Travers from the LSE debated what needs to happen to maintain London’s competitiveness and foster and retain the start-ups and small businesses that are essential to the capital’s future economy.
The discussion included how to build more homes, how digital connectivity might affect the future of work, and touched upon the benefits of greater London political devolution. On the latter, Professor Tony Travers spoke of the city’s unique position: “the way people commute to work and the housing crisis in London is vastly different to anything that works in the rest of the country. If London were given more powers, it would make better decisions to support the capital.” Panellists wanted a clearer vision from the next London Mayor about the type of London they want to see. Long term strategies, such as the 2050 London Infrastructure Plan, should be front and centre. Whilst some panellists suggested that schemes such as Cycle Superhighways and the Garden Bridge project distract from efforts to tackle more ‘fundamental’ issues around transport and housing, others believe these schemes add to London’s distinctiveness and identity – part of its allure as much as broadband speeds and tube trains.
London’s ability to adapt to change was offered as a reassurance against any sense of impending doom. London’s reputation and status as a major financial centre will not fade overnight. But this does not mean that we can afford to take our eye off the ball. Steps must be taken to secure the fundamentals – housing, transport and broadband connectivity – that any modern ‘megacity’ needs to thrive. In doing so, and by supporting small businesses and start-ups to be successful in London’s unique environment, there is no reason why London Tomorrow can’t be even better than London today.
Rob Griggs is head of the public affairs team at LCCI