The Great Meritocratic Metropolis

9 May

You couldn’t help enjoying the views over the last week. As Sarkozy and Hollande held their rallies against picturesque Parisian settings, it was hard to imagine how bad it would have to get before you’d feel compelled to leave.

But following Hollande’s election on Sunday, commentators were pondering on the threats of thousands of people to turn their backs on the French capital. Some of them may join the 300,000 fellow French citizens in France’s 6th city. South Kensington already feels a bit like Paris’s Latin Quarter, with the Lycée Francais and the many bistros, cafés and book shops, so they would blend in easily.

I grew up thinking that the French did quite a lot of things better than us: cuisine, style, egalitarianism, la belle vie. Then later, I couldn’t help hearing people talking about wanting to relocate to France, the superior work-life balance, and TV property programmes compounded the idea that a lot of Brits would much rather live in France than in the UK. And I have to admit, the case in favour is compelling. They have generally more space, better weather, proper mountains with snow, and an appreciation for the finer things in life. Though I have to say that their bread doesn’t last long and the idea of having to get up first thing to head to the bakery in your slippers is deeply flawed.

So why are so many Parisians living in London, and why aren’t there similar numbers going the other way? It doesn’t help that Paris is the 6th most expensive city in the world. But it is a question I often ask of the many French people I interview. The one thing they all agree on is that it improves their careers, because London offers significantly more opportunity and a less hierarchical, less formal employment environment. I hear it but it sometimes doesn’t go in. Have we flipped round the stereotypes of the British stiff upper lip and the French laissez-faire?  Can London really be viewed as the great meritocratic metropolis by the French? If not, then why did Sarkozy comment to French expats on a trip to London in 2007, “France is still your country even if you are disappointed by it”?

Still, Sarkozy is yesterday’s man. I look forward to the Merkel-Hollande boxing match, and to seeing if Hollande has the stomach to implement his promised 75% tax rate. And who knows, we could all soon again be enjoying coq au vin and a Burgundy in Paris for 50 francs, or souvlaki and retsina for 2,000 drachmas in Athens. Fantastic food for a fiver!

Chris Gee, Sales Director, SilverDoor

Dealing With Disruption: Mobile Workforce Management And The Olympic Summer

24 Apr

Transport in London can be a headache at the best of times, so it’s no surprise that many of London’s biggest businesses are putting contingency plans in place for this summer’s Olympics. Francis Maude, the Minister for the Cabinet Office and Horsham MP, has called on London’s biggest financial firms to offer staff the opportunity to work from home during the games, to alleviate potential problems with the transport network during the Olympics.

At a special Olympics Cabinet Meeting, Maude encouraged London’s businesses, especially those based in Canary Wharf, to allow their staff to work remotely over the summer. It’s thought that Canary Wharf’s train stations will be the most congested during the Olympics, as tourists head to the Olympic Park located nearby. Many of the city’s top financial professionals are expected to receive the go-ahead to work from home, as well as civil servants and other professionals, with KPMG, Deloitte and the Canary Wharf Group all supporting the idea.

Olympic Rings at St. Pancras: Jim Linwood on Flickr

Mobile workforce management is something which many businesses already embrace, with flexible and remote workers enjoying the freedom of working from home or on the move. There are many things for participating businesses to consider, including staff home broadband connection reliability and speeds, supplying VPN access to a network or server and the management of mobile devices such as smartphones and tablets. Considering the government has already warned that broadband connection speeds could be impeded during the Olympics, mobile devices could prove even more important.

Business managers’ main concerns about remote and flexible working revolve around business continuity: the ability for a business to ensure that critical functions are continually available to customers, suppliers, regulators, partners and others who need access. It’s about ensuring a business can continue without halt, regardless of adverse circumstances. If London’s businesses struggle to cope with transport disruption then they need to step their game up to cope with the Olympics.

Remote working is a key way of improving business continuity, as long as workers can be provided with the right tools for the job. Calls to their office extension can be forwarded to their home phone or mobile device, while VPN connections can help them access secure networks from their home computers or mobile devices. Not only does this give employees access to up-to-date information, but it also means that managers can keep track of their staff’s activities even when they’re out of the office.

The summer is going to be uniquely busy in London, so while some plan to put up their employees in a hotel for the duration of the Games, smart businesses are investing in mobile workforce management technologies which can help them cope with the disruption. Putting these measures in place will not only cut costs in the short term – it will also leave businesses better able to cope with future stresses and strains.

 

Alan Cairns writes on a number of subjects including mobile workforce management for GoMobilize.

Hong Kong 754, London 781

13 Apr

London has retained its standing as the world’s top financial centre. In the Global Financial Centres Index, the UK capital achieved a rating of 781, compared to 772 for New York, 754 for Hong Kong and 729 for Singapore. The rating is based on a survey of 77 centres, comparing factors like market access, infrastructure and competitiveness.

Why is Hong Kong the main Asian hub and can it take the top spot? After all, some economists are predicting that China (currently worth $7 trillion) will eclipse the US (currently worth $15 trillion) by 2022. But ratings for the Chinese cities of Shanghai, Beijing and Shenzhen all declined, possibly as a result of renminbi trading restrictions.

There is no VAT or GST in Hong Kong and no income tax higher than 16%, making it attractive from several perspectives. But there are great inequities in the distribution of wealth, domestic consumption is weak and there remain some bruises from the previous crashes of 1987 and 1997.

In September, I attended the Think Asia Think Hong Kong symposium in Westminster. The Hong Kong Trade Development Council planned to showcase Hong Kong’s unique market platform for trading with Asia, primarily mainland China. It was interesting but I couldn’t help thinking that the qualities they boasted about in Hong Kong are things we have long taken for granted in London and the UK as a whole: the rule of law, low levels of corruption, unrestricted media, a dynamic business environment, and freedom of information and speech.

In my opinion London, and the City in particular, needs to continue to do what it does best while learning some lessons from Hong Kong, which is proud of its status as the financial hub of Asia. Hong Kong boasts 8,300 qualified solicitors and 35,000 qualified accountants, and works hard to attract investment through low taxes and light-touch regulation. Unless we can stop banker bashing, sneering at the City and wishing that we could manufacture more, and instead start to promote our dominance in professional services again, we could well see Hong Kong overtake London.

 

Guest post by Chris Gee, Sales Director, SilverDoor

Is great service at the heart (shape of a heart) of New York?

7 Mar

I recently had a good debate with an Anglo American about how London competes with New York City in a number of categories, including the cost of living, quality of life, weather, nightlife, business opportunities and so on. I argued for London in most categories, and we agreed to disagree. I love New York, but overall I think London beats it.

A few days after the debate the Worldwide Cost of Living Survey from the Economist Intelligence Unit announced that New York is the 47thin the league table of the world’s most expensive cities while London is in 17thplace. So that’s one category I lost!

Maybe one of the reasons for this is that service sector wages are generally lower, which leads to a greater pressure to top up on tips.

But does this result in greater service standards in New York? What do New Yorkers think of customer service when they come over to London? In general New York and most of America has a good reputation for good service, but is that a myth? Beyond the smiles, being called ‘sir’ and ‘have a nice day’ does the reality match the reputation? For example, does the average New York taxi driver know his city as well as your reliable London Black Taxi driver knows his? Does the average subway guard point you in the right direction when you’re lost, like our sometimes maligned tube guards?

My own view is that there isn’t much in it, but in New York you spend too much time tipping and thinking about who to tip and who you don’t have to tip, and how much to tip. You can’t relax!

Our company is in contact with corporate housing providers in New York every day, so it gives us a great insight into that sector and how it operates compared to London. In New York it is more difficult to negotiate, more admin. and paperwork is required, and it is much harder to get credit. There are also much stricter length of stay rules in New York and overall serviced apartments are more expensive. If you need to stay in New York for more than 5 nights, my tip is to take a serviced apartment across the water in Jersey City. There, minimum stay rules don’t apply, it’s considerably cheaper and the PATH train gets you into Manhattan in 15 minutes. In addition you get spectacular views of Manhattan!

Guest post by Chris Gee, Sales Director, SilverDoor

The New Dallas

10 Feb

Aberdeen is the heart of the European oil and gas industry, and an international hub for companies in the field. As such it attracts large numbers of oil company workers from rig engineers to multi-millionaire owners, from Houston Texas to Stavanger Norway.

Due to the high volume of international trade and business travellers working in Aberdeen for longer stays, the serviced apartment sector is thriving, with operators such as The Spires, Dreamhouse, Micasa, Oakhill Aspect, Craibstone and Parkhill all offering home from home serviced apartments for less cost than a traditional hotel.

Aberdeen manages to maintain a friendly and fun atmosphere despite the challenges of deep-seated economic inequities. “Millionaires’ Row” aka Queens Road pushes up property prices beyond the reach of many locals, and the owners of very expensive cars rub shoulders with rig workers and fishermen. Perhaps the fact that there is almost no unemployment is a crucial factor, and a very good illustration of how the super-rich can rub along perfectly well with ordinary folk when it is clear that there is opportunity for all.

Amongst several accolades and claims, Aberdeen boasts the 2nd largest heliport in the world and has won Britain in Bloom a record-breaking 10 times.

In March 2004 Aberdeen was awarded Fairtrade City status by the Fairtrade Foundation, and this was a catalyst for the city’s concerted effort to transform its reputation as the Oil Capital of Europe into the Energy Capital of Europe. As a reflection of the established and the new guard, the city hosts both an annual Oil Barons’ Ball and the UK’s largest renewables event in the UK. Many traditional oil companies have diversified into wind and wave power, which has helped the UK to establish itself as the world’s biggest offshore wind market. British industries from boat-building to concrete, and electric cabling to gearbox manufacturing are hoping to benefit from the construction of thousands of offshore wind turbines, if new plans go ahead.

A group representing the UK’s offshore wind industry on Monday (6th Feb) adopted a target of ensuring that more than half of the supply chain for offshore windfarms is sourced from the UK. At present, less than a third of the value of the goods and services needed to construct offshore wind farms actually originates in the UK.

Guest post by Chris Gee, Sales Director SilverDoor

2012 UK Bank Holidays

18 Jan

New Year’s Day (Sunday): 1 January

Good Friday (Friday): 6 April

Easter Monday (Monday): 9 April

Early May Bank Holiday (Monday): 7 May

Spring Bank Holiday (Monday): 4 June

Queen’s Diamond Jubilee (Tuesday): 5 June

Summer Bank Holiday (Monday): 27 August

Christmas Day (Tuesday): 25 December

Boxing Day (Wednesday): 26 December

A Bloggers Guide to the Eurozone Crisis

7 Dec

The Background

In the late 1950s, the leading European nations started developing the concept of a strong Euro trading region to compensate for the waning global power of the area.

 Their ideal scenario for the Euro project was firstly to establish close trading partnerships between European nations unburdened by borders and tariffs, followed by a common currency to overcome interest rate barriers and then on to fiscal union where we would have common policies on little things like taxes and social welfare.  Finally, this would all be topped off with political union, leading to the Federal Superstate so coveted by pro-Euro supporters.

The major flaw here, as accepted by many respected commentators, is that this ideology ignores the fact that each individual country across Europe has different desired outcomes.


Winners and Losers

After all these years it is only really the first part of the project that has been achieved with open borders to trade within the EU.  Part two; economic and monetary union has been partially introduced with 17 member states using the euro.  However, MEPs in Brussels continue to struggle to get buy-in to their rules and regulations.

Currency union has been great for the industrial powerhouses, like Germany, seeking to export large quantities of their top quality products around the world at competitive prices.  What crisis, I hear Angela Merkel say?

However, the peripheral nations, for example Ireland when ‘Riding the Celtic Tiger’, have enjoyed fantastic periods of growth due to their ability to borrow large sums of money at the competitive rates available to them pre the 2008 banking crisis.  At this time the global financial markets felt there was an implicit guarantee on eurozone member bonds from the ECB/Germany.  This created a false impression of wealth for the Irish via a property bubble, which then enabled successive governments to adopt very generous social welfare policies thereby currying favour with the electorate.  Instead of banking their profits and building up the strength of their balance sheet, they borrowed more and this eventually led to their downfall.  A very familiar story to that of Greece and the other southern Europeans

 

The Problem

There is a strong argument that this profligacy of the smaller nations in the good times has been the major contributor to the eurozone crisis. The flaws in the concept were covered up by the highly leveraged excesses of the last decade, and the apparent successes of the peripheral countries were always built on sand.  When the markets turned, following the 2008 banking crisis, asset values collapsed and business and consumer spending slowed to a virtual standstill.  As government income fell, their debt burden increased as highly efficient markets pushed up bond yields, and therefore interest rates, to unmanageable levels.

As a consequence, the people have spoken in many of the euro countries; Slovakia, Ireland, Greece, Portugal, Italy, Spain have all seen changes in governments.  The French have an election next year and the Germans are governed by a coalition.  Hardly a ringing endorsement!

 

The Potential Solutions

Most are clamouring for the European Central Bank (ECB) to step in and act as the lender of last resort to the distressed nations.  This would have the effect of reducing their borrowing costs, but not necessarily their profligacy.  In fact it might even encourage it!

Germany remains staunchly against this, as it would in effect be the ECB printing money which, as we know, is likely to be inflationary.

The next option, currently under consideration, is the introduction of Eurobonds.  These would in effect be underwritten by the stronger countries (Germany) and benefit the weaker countries by enabling a lower borrowing rate.  However, the stronger countries would demand a say in the running of the smaller countries to make sure they stuck with their austerity plans.  The weaker nations of course won’t like this – back to the flaw in the concept.  This option is for the longer term and will not solve the current crisis.

The other options are for a break-up, or partial break-up of the eurozone.  Very unpalatable to all.

It seems the likelihood is that Germany will continue ‘kicking the can down the road’ for as long as they can, saying all the time that they will definitely not support ECB intervention.  However, ultimately, to save the euro in whatever form they can, it is likely they will have to accede to this.  The alternative, a breakup of the eurozone, would not be good for them.  If this happened and they returned to the deutschmark, it would likely have a significantly higher value against other currencies than they currently enjoy with the euro.  This would of course have the effect of making their products more expensive to other countries thereby curbing their export capability and making them far more reliant on a culturally prudent domestic market.  Very difficult!

 

Last thoughts

My biggest concern about the 2008 banking collapse was always the Moral Hazard issue.  In a free market economy when organisations fail for whatever reason, there are mechanisms in place to carry out an orderly disposal of available assets, and the capacity that this failed entity was soaking up is distributed to other suppliers.  The shareholders of the organisation lose their money.  They took a risk to invest on the basis that it might be the next Microsoft or Apple.

We are now getting to the big guns with Italy and France.  This is exactly the same as the sub-prime crisis.  Suddenly the casualties are too big to fail.  If the Europeans adopt the same strategy as with the previous crisis, these countries will be bailed out to avoid such a potentially catastrophic collapse. Germany, and the European Central Bank, will be forced to become the lenders of last resort, as the alternative forEuropewill be disaster.

Whilst many will argue that this will be preferable to an outright failure, in my opinion it would result in many more unintended consequences for years to come.

 

John Thompson is a consultant for Bibby Financial Services

AWR and the implications for UK businesses

7 Oct

As of 1 October 2011, agency workers in the UK now have the right to equal treatment in certain areas of their employment, as a result of the Agency Workers Regulations (AWR) which are set to make a significant impact on the UK’s flexible workforce.

Under AWR, all agency workers are entitled to the same basic employment and working conditions as a permanent equivalent in relation to pay, working time and annual leave, after a twelve week qualifying period. Agency workers also have the right to be informed of any relevant internal opportunities for permanent employment. The regulations exclude sick pay, maternity or paternity pay, redundancy, notice pay, payments related to pension entitlement, and bonuses not based on individual performance.

For the most part, it will be business as usual for UK employers. Our sixteen years working in the temporary and contractor marketplace shows that the majority of such contracts do not last longer than twelve weeks. In these circumstances, businesses have little cause for concern.

Businesses stand to benefit from the employment of temporary and contract workers. The recruitment of temps and contractors is growing, with more than 1.4 million people currently employed on a freelance basis in the UK. A lot of hirers use the temporary marketplace to source good quality permanent workers similar to the concept of “try before you recruit”, and in fact we have seen a 17% rise in temporary workers going permanent within the same company.

However, the AWR clock has been set in motion and is ticking, so there are important measures UKbusinesses must take to ensure they comply fully with the regulations now in place.

Businesses that partner with a quality recruitment agency for temporary workers will stand to benefit. Working with an agency will ensure businesses know which temporary workers have worked the twelve calendar week probation period, even if this has not taken place over twelve consecutive weeks – as contractors are entitled to a break of up to six calendar weeks with the same employer.

There are two potential paths recruitment agencies can then follow to ensure they comply with the terms set out by the regulations. The safest, most compliant and ethical solution that also helps control costs, is to use a comparable full-time worker as a benchmark for the temporary worker’s terms – otherwise known as the comparator model. The compliance that the comparator route offers will ensure that businesses feel secure in that they are fulfilling all legal requirements and acting in the spirit of the AWR.

An alternative route to meeting AWR requirements is to use the Swedish Derogation clause. Simply, it means that AWR rights to equal pay of an agency worker no longer exist, where temporary workers are employed directly by a temporary work agency or umbrella company on a permanent basis, and receive pay in-between assignments. The contractor must be paid up to 50% of their highest-earning weekly salary (or national minimum wage if that’s higher) for up to four weeks after the assignment finishes (designed to assist them in looking for a new contract). These post-assignment financial liabilities make it much more difficult to predict the true value of a contract, meaning that forecasting cash flow is more difficult

Those considering using Swedish Derogation should be warned – the trade unions are focusing much of their attention on it, with the intention of bringing tribunals and class actions against those they believe to be breaching the AWR regulations.  Businesses that are seen to be ultimately undermining the protection of temporary workers with Swedish Derogation are highly likely to be first in the line of fire.

The implementation of AWR serves to underline the economic benefits of a flexible workforce for the UK. Businesses should fully acknowledge the importance of the temporary workers market in stimulating economic growth by providing short-term no-obligation labour and as way to “try before you buy”. Businesses that fully understand the terms of AWR, have adjusted their administration accordingly and partnered with a knowledgeable recruitment agency stand to benefit. AWR will see that fairness is firmly entrenched in the system and temporary workers are more closely integrated into the company and its culture, benefitting both employee and employer.

 

Guest post by Simon Last-Sutton, FPS Group

http://www.fpsgroup.com/

Smart Money: TCIO

26 Sep

The Tech City Investment Organisation was created by UK Trade and Investment (UKTI) to help attract the brightest and best of technology businesses to the east London hub of innovation.  The organisation offers a network of influential people with money to invest in tech start-ups, and it helps small tech companies to find the cash they need to grow and flourish.

It hosts events, facilitates partnerships (such as one this month between Facebook and Apps for Good that has resulted in a number of training opportunities for youngsters across the capital) and makes introductions, particularly getting major technology players involved in school initiatives. One key goal is to inspire youngsters to pursue Science, Technology, Engineering and Maths (STEM) subjects at school – subjects in which the UK has been lagging behind the rest of the international community of late.


Tech City: Britain’s answer to Silicon Valley

23 Sep

In the next few posts I’ll be writing about Tech City, which is British Prime Minister David Cameron’s planned cluster of technology companies in East London. Located in the east London areas of Shoreditch, Stratford and the Olympic Park, Tech City now houses over 500 start-ups, up from 200 just a year ago, making it Europe’s fastest growing cluster. Smack-bang in the middle of everything-2012, Tech City offers the perfect environment for entrepreneurs to take advantage of the host of opportunities promised by the games. But how exactly did Tech City come about?

History of Tech City

November 2010: David Cameron unveils his plans for Tech City, which will aim …”to bring together the creativity and energy of Shoreditch and the incredible possibilities of the Olympic Park to help make East London one of the world’s great technology centres.”

November 2010: Recognising the need to address intellectual property (IP) laws, which are currently a major barrier to the growth of tech SMEs, David Cameron launches a review of the IP laws.

May 2011: LinkedIn’s former UK and Europea MD, Kevin Eyres, appointed as Tech City’s first mentor to give support and advice to entrepreneurs looking to set up tech businesses.

July 2011: Government spends £100k to promote Tech City abroad.

July 2011: Prince William and Princess Catherine promote Tech City on a tour to the US in support of British Business.

August 2011: The Tech City Launchpad, well, launches. Run by government’s Technology Strategy Board, Launchpad is a competition that will result in grants of £100,000 being provided to a selected group of 20 companies that develop innovative products.