James Moore: Ignore the doom-mongers, the City lights are getting brighter all the time

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The Independent Online

Outlook There are still people who would have you believe that those employed in London's financial centre are falling over each other to get on the last plane out of town.

The doom-mongers will tell you that nasty new regulations enforced by nasty new regulators with the willing connivance of politicians desperate to appease a vengeful public mean that the party's not just over, it's shipped off to Singapore and Hong Kong and won't be coming back. If only Pippa Middleton would follow.

How then, to view yesterday's figures from the City of London Corporation and Oxford Economics that showed the total number of people in jobs across Greater London is now ahead of where it was before the recession started to bite, driven by the financial centre?

It's true that the banking industry is still suffering from its prolonged post credit crunch hangover. But other sectors are more than picking up the slack, such as fund management, insurance, legal and professional and business services.

In other words, turn the lights back on and (sigh) call back Pippa. The party's just getting started. Up to a point, anyway.

We've become so accustomed to seeing the City in terms of banking that it is often forgotten that it is much more than a one trick pony. It might even be that the banking industry's troubles are helping other parts of the City's fauna by diverting the sort of bright graduates who used to be vacuumed up by investment banks into alternative areas.

Whether that's true or not, what is clear is that the City of London is getting over a financial crisis it helped to trigger far faster than the rest of the country. Three times as quickly, in fact.

The gap between the capital and the rest of Britain has never been so wide. That point was underlined by yesterday's nationwide Markit/CIPS Construction Purchasing Managers' Index. It fell to 49.3 last month from 50.9 in October, the lowest headline figure since August and below the 50 mark separating growth from contraction. This was for the third time in four months.

The City's advocates would say that's a very good reason to cosset the City: it is protecting the rest of the country from looking like Portugal. Or Poland.

Others might argue that the reverse is true; the rest of the rest of the country might stand more of a chance of pulling itself back up if the City wasn't there, or at least if it were less dominant. They may have a point.