Many London-based employers have plans to expand their workforces as the economic recovery continues.

According to a recent CBI/KPMG London Business Survey, about 62% of businesses in the UK capital expect to grow in the coming year. Last December, this number was at 53%.

The survey also revealed that most of this growth is planned to occur outside of London, with only 29% hoping to develop inside the city borders. However, the majority of all businesses surveyed – 92% – did state that London is an excellent place to do business from when compared to other global centres.

Additionally, companies in London have also indicated that they plan to spend more time, money, and effort on recruitment and training, product innovation, and IT plant and machinery. These same companies will be spending less on buildings and land.

Because businesses are considering a move outside of London itself, legislators and economists alike may need to re-evaluate fiscal challenges in the city.

“It’s encouraging that more London firms plan to expand but worrying that fewer expect to do so in the capital. Some of the perennial challenges of doing business in the capital, like high operating costs, housing shortages and transport challenges, threaten to undermine investment confidence. This is a wake-up call – we need to make sure that London does not lose ground to global rivals,” explains CBI director Sara Parker.

The survey, which focused on 138 businesses’ views on London as a place to do business, was conducted between 17 April and 8 May 2013.