RSS FeedCity Bonuses Feel the Sting of the Credit Crunch
09/05/2008
City bonuses are to be slashed as the economic gap between the South and North of England is set to close for the first time in six years.
A report issued today showed that London's economic growth has slowed to the extent that city bonuses will be down 40% this year, and by next year there will be no economic growth difference between the North and South of England at all.
The report also showed that UK GDP growth is down from 3% last year to just 1.8% in 2008.
The average output of every Londoner - the gross value added (GVA) - will fall to 1.5% in 2009 from 2.3% the previous year. In the north-east, however, GVA will increase to 1.2% from 0.9% the year earlier.
This comes a week after Bank of England governor Mervyn King identified the city's 'bonus culture' as the inciter of the current economic turbulence. He stated that it encourages greater risk taking.
Financial experts The Centre for Economics and Business were quoted in today's Guardian as saying: "The credit crunch raises enormous questions about whether the City's bonus culture has been encouraging excessive risk-taking. We expect bonus regimes to be scaled back over the coming years."
A report issued today showed that London's economic growth has slowed to the extent that city bonuses will be down 40% this year, and by next year there will be no economic growth difference between the North and South of England at all.
The report also showed that UK GDP growth is down from 3% last year to just 1.8% in 2008.
The average output of every Londoner - the gross value added (GVA) - will fall to 1.5% in 2009 from 2.3% the previous year. In the north-east, however, GVA will increase to 1.2% from 0.9% the year earlier.
This comes a week after Bank of England governor Mervyn King identified the city's 'bonus culture' as the inciter of the current economic turbulence. He stated that it encourages greater risk taking.
Financial experts The Centre for Economics and Business were quoted in today's Guardian as saying: "The credit crunch raises enormous questions about whether the City's bonus culture has been encouraging excessive risk-taking. We expect bonus regimes to be scaled back over the coming years."