Competition, Diversification,

Internationalization and the Location

of Business Services in Britain

Peter W. DANIELS

Department of Geography University of Liverpool

Introduction

Our understanding of the development of urban and regional economies during the last quarter of the twentisth century could not proceed far without reference to the role of business services. Although not large in terms of its share of total national employment, the business services sector, covering a range of activities from estate agency, legal and advertising services to accountancy, banking and insurance services, has recently been and is expected to continue to be (until at least the early 1990s) the principal source of new jobs in advanced economies (Rajan, 1987; Browne, 1986). Between June 1984 and June 1985 the largest absolute and proportional increase in jobs in Britain occurred in banking, finance, insurance and business services (79,000, + 4.3 per cent) with hotels and catering not far behind at 4. 1 per cent (41 ,000). During the same period some manufacturing industries contracted by more than 3 per cent e.g. motor vehicles and parts (- 9,000, - 3.1 per cent) and other transport equipment (- 13,000, - 4.4 per cent). The service sector as a whole is expected to generate up to 5000,000 new jobs in Britain between 1985 and 1990 (Table I); but these will be offset by an anticipated decrease of 650,000 jobs in manufacturing (Rajan, 1987).

These changes in the sectoral distribution of British employment also signal significant changes in the nation's occupation structure. Advances in technology and the needs of employers will generate a requirement for more skilled workers in services, ranging from those skilled in customer /client interaction (such as shop assistants or bank tellers), to engineers and technologists specializing in information technology, and professionnals such as accountants, corporate lawyers, marketing specialists and experts in data processing. The biggest increases over the period to 1995 are projected to be in professionnal occupations, up to 900,000; followed by management posts, up to 400,000; sales and other personal services, up to 300,000; and clerical and secretarial occupations, up to 200,000 (Institute for Employment Research, 1987). A number of other countries such as the United States, West Germany, Canada and Australia ars experiencing a similar kind of industrial and occupational restructuring (Table 2) (Daniels, 1985).

REVUE D'ÉCONOMIE INDUSTRIELLE - n° 43, 1« trimestre 1988 49