Financial Center and the Overall Economy
There are close links between the overall economy and the financial center in the Canton of Zurich. The financial center generates exceptionally strong stimulus for the region's economy. Switzerland's small open economy includes a financial sector of above-average size which accounts for a remarkable 11% of the national figure for aggregate value added. The financial center's share of total employment in Canton Zurich is over 10%, as compared to the Swiss average of about 3%.
Employment
The Zurich Financial Center is focused in the city of Zurich itself, but recent years have seen it expand into the surrounding conurbations and the neighboring cantons of Schwyz and Zug. About 100,000 people are employed in the Zurich Financial Center, and most of them work in the city of Zurich; the rest is spread across Canton Zurich and the Cantons of Schwyz and Zug. The financial sector accounts for one out of every five jobs in the city of Zurich. 60% of financial employees work in banks, a quarter in insurance companies.
Alongside banks and insurance companies, the financial sector also includes specialist financial service providers. They are less strictly regulated than banks and insurance companies in terms of authorization requirements and supervision. The specialist financial service providers include independent asset managers, broker-dealers, the stock exchange, hedge funds, private equity providers, tax advisors and accountants, to name just a few examples.
Employment data - Federal Statistical Office (FSO)
Value Added
The financial sector generates a very high rate of added value. Its share of Switzerland's total gross added value is 11% (taking the longer-term average); in Canton Zurich, the quota is somewhat higher than 20%. The banking sector creates added value of about CHF 246,000 per employee, and the figure for the insurance industry is almost CHF 310,000. This means that the productivity of employees in these sectors is more than twice as high as their counterparts in industry.
The factors that influence the development of the financial sector include the performance of the economy and movements on the financial markets, so its results can sometimes fluctuate sharply. Viewed in the longer term, however, the financial sector is one of the most important growth drivers for the economies of both Switzerland and Zurich.
Value added by sectors (production account) Federal Statistical Office (FSO)
Economic Importance
Due to its size and its high rate of value creation, the financial sector also has a major impact on salaries, employment, and tax revenues in the Zurich region. Switzerland generates 16% of its tax revenue from its successful financial center.
In an average year, approx. 80% of tax revenue in the city of Zurich originates from legal entities in the financial sector. All the city's legal entities taken together account for 30% of its municipal tax revenues. In Canton Zurich, banking institutions contribute about 43% of the total cantonal taxes levied on legal entities. All the canton's legal entities taken together account for an average of 20% of its total tax revenue.
Large numbers of other service providers who complement the financial sector are active in the region. They provide supplier services to meet specific requirements within the financial sector - examples include attorneys and accountants. On a broader basis, economic sectors such as IT, the advertising and communications industry, the catering and hotel sectors, and the retail trade all benefit from the demand generated by financial service providers and their employees or clients.
The History section outlines the development of the Zurich Financial Center's international competitive edge and explains how its importance has grown over time.
Disclaimer
The figures quoted here are based on official statistics and on the Monitoring Finanzplatz Zürich.