yesterday. London, a dynamic, multicultural, eccentric metropolis where everyone, of origin or adoption, could stake their destiny. The pandemic and Brexit have shattered the umbilical image of the planet, as evidenced by the 8% drop in the population recorded since March. This is the first contraction in more than three decades.
According to a study by the study center Economic Centre for Excellence, the capital, which had 9 million inhabitants in 2019, has lost 700,000 people, the vast majority of them foreigners, since the entry into force of the first confinement, on March 23, 2020. These are mainly low-income workers. or not qualified operating in the leisure and tourism sectors (restaurants, pubs, hotels, entertainment…), hard hit by the health restrictions linked to the Covid.
According to the town hall, the shortfall amounts to 44 billion pounds (49.42 billion euros) in 2020 due to a 9.5% contraction in the capital’s growth rate. The official unemployment rate fell from 4.3% to 6%. And it will be necessary to wait until the summer of 2022 for the expected recovery to make its effects known.
“For sale” signs
Brexit is also at the origin of these departures. Scared by the prospect of the exit on the 1stis January, many professionals of the City from the European Union, like financiers, lawyers, accountants and subcontractors, have decamped. Financial services, which are not covered by the exit trade deal between the UK and the EU, have been hit hard. The entry into force of a points-based residence permit was a dissuasive factor for nationals of the 27.
The fallout from these departures is particularly felt in real estate, an essential barometer of economic activity across the Channel. Rents have fallen from 25% to 50% while signs “for sale” have reappeared in upscale neighborhoods deserted by foreign buyers. The generous state aid to help employees and the self-employed and the tax breaks in favor of first-time buyers have hardly slowed down this depopulation.
The misfortune of some making the happiness of others, the large airy suburbs and the cities of « shires » from the south of England attract some of those who go in search of a better quality of life.
New arrivals
London specialist at the London School of Economics, Tony Travers intends to play down the study by stressing that New York and Paris have experienced the same phenomenon: “Many will come back, because London has retained important assets, open economy, diverse immigration, absence of ghettos, multilingual and well-trained workforce. The proof is that the American high-tech firms have set their sights on the city ”. Our interlocutor emphasizes that the expected reduction in European immigration has been largely offset by new arrivals from the Indian subcontinent, China, Japan and Oceania. In addition, Beijing’s stranglehold on Hong Kong should lead to a large influx of graduates from the former colony.
Others highlight the salutary side of this decline in an overpopulated capital which creaked in all its seams under its antiphon to efficiency and its ode to profit. “It could no longer continue at this infernal pace of expansion as shown by the dysfunctions of urban infrastructure, education, health and municipal management,” said, for his part, an expert of the London real estate market quoted speak Financial Times.
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