HAMISH MCRAE: London must flourish as lockdown lifts

London is creeping back to work, but the scars will last a while. All giant cities will be damaged, for they are centres for the entertainment and hospitality industries as well as transport hubs. So New York and Paris will be damaged too. 

But there are troubling reasons to suspect that the London economy may be particularly hard hit. 

For a start, more people fly through London’s six airports than any other place on Earth – 170 million against New York’s four airports’ 140 million. 

If it does indeed take several years for the airline industry to recover, then this huge industry will be a drag on the wider economy. 

Add to that what a decline says about other business activity, such as money spent on hotels, theatres, restaurants and shops, and the damage widens. 

Or take another measure of globalisation: numbers of international students. London last year hosted 125,035 of them, up 5.8 per cent on the previous year. 

That works out at about 40 per cent of the country’s total. The largest number, nearly 26,000, came from China, up 20 per cent on the previous year, with US students the second largest. I fear not many will enrol this coming autumn. 

European borders may reopen, but Europeans are not such an important market. But the biggest challenge will be that faced by the biggest industry: financial services. 

The City is hugely resilient. It keeps reinventing itself, figuring out new services it can sell to the world. It has lost a little ground to New York in the past five years and it may lose a bit more. But as long as it can attract global talent, it will think of new things to do. 

However, it may not need the shining tower office blocks that continue to sprout in the City and in Canary Wharf to do the job. 

Of course, it will need some of the space, but as Jes Staley – chief executive of Barclays – told reporters last month, ‘the notion of putting 7,000 people in a building may be a thing of the past’. 

Other bank chiefs have made the same point. Being forced to run the business with three-quarters or more of the staff at home has been an eye-opener for many businesses. 

There will be permanent changes in the way we work, and a decline in the numbers of people in city centres at any one time will be one of them. 

It is small comfort that as a result of this retreat from the office, New York may take a bigger hit than London. 

This leads to an even larger question: why do cities rise and fall? 

Until a few weeks ago we took the primacy of great global cities for granted. They were expensive to live in but the creativity, the drive, the buzz of metropolitan activity was a compensation for the lack of personal living space. 

But it has not always been so. Remember London in the 1960s and 1970s? Population dropped year after year and there was a bizarre quango called the Location of Offices Bureau, that actually encouraged businesses to shut London offices and dispersed jobs elsewhere. That was a bright idea: try to run down your greatest city. 

Or remember New York in 1975 when the city was virtually bankrupt and President Gerald Ford denied it federal support? That led to the famous headline in the New York Daily News: Drop Dead. 

New York did not drop dead. It raised loans, squared its creditors, cut costs and rebuilt its economy, but the memory lingers. 

Last month, its current mayor Bill de Blasio accused Donald Trump of failing to support the city: ‘Are you telling New York City to drop dead?’ he asked. 

Few people doubt the need to rebalance the UK economy. Large swathes of the country, and not only north of Watford, have been neglected by central government. 

The commitment to reverse this helped win the last Election. An unbalanced economy is an unstable one, and my word we need some stability now. 

We are learning new ways of working, ways that will at best lead to a more efficient economy. 

There will, again at best, be less time wasted in meetings and less time commuting. 

But we need to be aware of the fragility of the economies of great cities, including – and perhaps especially London, which is why we need to get things moving again.