City firms increase hiring and technology investment plans in spite of Brexit uncertainty

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Financial services firms increased hiring and investment in the second quarter in spite of continued nerves over the Brexit process, new figures show.

Employment across financial services rose at the fastest pace in a year, with a balance of 24 per cent saying they had increased hiring in the second quarter, according to the survey of major firms by the Confederation of British Industry (CBI) published today.

Meanwhile, booming spending on information technology continues to be a major driver of investment, with a balance of 70 per cent of the 100 firms polled saying they will increase spending compared to last year.

The CBI’s survey of Square Mile firms also reveals that 70 per cent of banks, insurers and investment managers say they are “confident” they will have plans in place by the time the UK leaves the EU at the end of March 2019, even if there is no deal.

Yet nerves remain for the City, as contingency planning for the most damaging Brexit scenarios continue, with optimism over the business environment for financial services staying flat.

Rain Newton-Smith, CBI chief economist, said: “Despite fairly subdued growth last quarter, it’s good to see financial firms stepping up hiring and investment, with digital technologies and new services seen as the best way to grow in a fiercely competitive environment.”

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