Financial sector remains a pillar of Swiss economy, data shows
The financial sector remained a major contributor to the Swiss economy in 2022 in terms of growth, employment and tax revenue. The collapse of Credit Suisse and its takeover by UBS last spring are likely to affect the labour market in particular.
Last year, the industry employed 234,600 full-time equivalents (FTEs), or 5.4% of all salaried jobs in the country, according to a study published on Thursday by the economic research institute BAK Economics on behalf of the Swiss Bankers Association and the Swiss Insurance Association.
The data also shows that companies in the financial sector generated gross direct added value of CHF70.9 billion ($80.2 billion, 6.2%), or 9.3% of that generated nationwide, a result that can be explained by “above-average” productivity, according to the economists at the Basel-based institute. Even with a slight decline, the contribution of banks (5.4%) remains significantly higher than that of insurance companies (3.9%).
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Direct taxation of the income of employees and the profits of companies in the financial sector brought in tax revenues of CHF7.8 billion for the Confederation, cantons and municipalities, compared with CHF9.7 billion in 2021, which corresponds to 7.6% of the direct tax levied last year on all individuals and legal entities in Switzerland.
Impact of Credit Suisse takeover on employment
Taking into account the multiplier effects (demand for intermediary services and consumer spending by employees), the weight of the financial sector in the Swiss economy was even greater: 10.3% in terms of FTE jobs (448,200), 13.3% in terms of gross value added, and 11.7% in terms of tax revenue.
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For the current year, the experts at BAK Economics forecast a 3.4% decline in real gross added value for the banking sector (which does not take into account the nominal increase in the interest margin following the SNB’s rate hikes), followed by a 4% rebound in 2024. Insurance, for its part, should continue to benefit from rising premium volumes in both 2023 (3.3%) and 2024 (3%).
The integration of Credit Suisse into UBS is expected to have a negative impact on employment growth from next year onwards, at 0.8%, and at 0.6% on average over the 2025-2028 period.
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