"London Money" has been good for a long time, but it's not just about location. It's a vortex effect that makes "London" a shorthand for "talented, productive and driven". If you're talented, productive and driven, you move to London where you can make more money (and work on more cutting-edge stuff). If you want those people, you set up in London and pay London Money to hire them.
It's not that you earn less in small-town Hampshire just because it's small-town Hampshire. The pool of talent there excludes the people who went to London to chase the big time. You pay small-town Hampshire money, you get small-town Hampshire people. And believe me, after nearly 20 years in UK software, those folks aren't great. Some are competent, but stuck in a technical rut. Others are just poor at what they do. This effect has been writ large in inter-country business - an Indian colleague told me a while ago that her opinion on why outsourcing was such a mess was that the best people leave for the US. The second tier leave for Europe or Canada. Who does that leave to work for outsourcing firms?
If the geographical vortex effect falls due to a change in working practices, companies are still going to need to pay to get good people.
Banks like JPMC and Starling know this - their offices outside London pay near-as-dammit London salaries because they want talented, productive and driven employees and if you want to attract them, you need to pay.
I have been in Manchester for a few days, and except for my friends and few exceptionally good food & club places town is simply unsatisfying (I do not know what word to use to describe maybe day time boring). For me I would rather take a StarLink and move to Scottish mountains ...
Don't get me wrong, I do not hate rest of UK, there are different towns, and they are quite different, some are nice and pretty, other look like post-communistic havoc...
Yes, there's a lot to do there. The tradeoff is poor air quality, limited access to the natural world, bad smells, overcrowding, huge living expense.
You grow out of clubs. These days I like a pub I can sit down in. And most Londoners that I know stopped doing all the immense number of things at some point. Plus I can get to central London pretty quickly on the train if I want to. Usually I don't though.
It's probably partially my age but I know a lot of people who are on the verge of leaving, partially due to remote working opportunities from Covid but mostly due to being priced out. Even those I know staying "in" London are having to buy in Essex, Hertfordshire etc. due to the cost. London's housing crisis is only getting worse every year, in enough time the upside may be that it helps other cities develop instead.