Euro Exits Would Be Biggest Threat To UK Financial Jobs
Written by Geoff Newman on 1/3/2012
Many of Britain's financial leaders believe that a break-up of the euro would pose the biggest risk to financial jobs and business over the coming year, according to a new survey by financial services firm Deloitte.
The finance directors surveyed in the research said that a Greek exit or the collapse of the single currency will have a devastating effect on exports and business confidence. Bleakly, some 37 per cent of the respondents said that they believed that at least one Eurozone state would exit the currency in 2012.
The chief economist at Deloitte, Ian Stewart, said that the Continental instability is proving decisive for British business.
"The results illustrate the corrosive effect of uncertainty on corporate spending: 87 per cent of finance directors believe this is a bad time to be taking additional risk on to their balance sheet," he explained. "Just as it happened in late 2008, finance directors are reacting to a tough climate by strengthening their balance sheets."
He added that the worsening global situation has caused a dramatic reversal in 2012 plans by companies, compared to the strategies for 2011.
Stewart said, "Firms entered 2011 with a focus on expanding into new markets and increasing capital spending. They enter 2012 with a focus on cutting costs and increasing cash flow."
Geoff Newman, chief executive on web based recruitment company RecruitmentGenius.com believes the ramifications of a Euro collapse would not just harm the finance sector.
"Almost all our customers in the finance sector are putting plans on hold for the first two months of this year, the sentiment is not 'if' but 'when' the Euro will collapse. However business confidence throughout every sector will be damaged therefore effecting everyone. Sadly I foresee even great unemployment but it is almost inevitable."