Why 77% of Big London Firms Can't Hire — and What It Means for EU Startups

Jan de Vries · 2026-09-16

### The Housing Crunch Is Now a Hiring Crisis London's housing costs have quietly become a recruitment problem. A new survey found that 77% of large firms in the city say housing expenses are hurting their ability to hire and keep workers. That's not a small number. It's a flashing red light. Behind that stat are real people. Young professionals, the ones companies rely on to grow, are finding it nearly impossible to buy a home. When your paycheck disappears into rent, moving to a big city for a job stops making sense. ### Why This Matters for European Startups You might be thinking: I'm building a startup in Berlin or Lisbon, not London. Why should I care? Here's why. London has long been the gateway for European talent, capital, and ideas. When its housing market squeezes workers out, the ripple effects reach every EU startup hub. Talent that would've moved to London is now looking elsewhere. That's an opportunity. But it's also a warning. If housing costs keep climbing across Europe's major cities, startups everywhere will face the same hiring wall. ### The EU Inc Proposal: A Timely Fix? The EU Inc proposal is designed to make it easier to incorporate and scale across Europe. One company, one set of rules, less bureaucracy. It's a bold idea. But even the best legal framework can't fix a housing market that prices out your future employees. So what does this mean in practice? - Startups in expensive cities may need to offer remote-first roles to attract talent. - Smaller cities with affordable housing could become the new startup magnets. - Companies that ignore housing costs in their hiring strategy will lose out. ### What Smart Founders Are Doing Now The founders I talk to aren't waiting for policy to catch up. They're getting creative. > "We stopped requiring people to live in London," one founder told me. "Our best engineer moved to a town where a three-bedroom house costs less than a studio in the city. He's happier, and he's more productive." That's the shift. Housing isn't just a personal problem anymore. It's a business strategy question. If you're building a startup in Europe, ask yourself: can your team afford to live near your office? If the answer is no, you've got a problem. And it's not going away. The EU Inc proposal could help streamline how you hire across borders. But it won't build houses. That part is on all of us — founders, policymakers, and cities — to figure out. Until then, the smartest move is flexibility. Let talent live where they can thrive, not just where your office happens to be.