That question was posed on one of local forum groups recently - and I think needs an answer.
To answer that question we have to have an idea of what is the finance industry. How about a human scheme to store up treasure on earth. Thats the simplest outline I can offer that covers banking , trust companies, investment holdings and even inheritance tax. All of which are significant parts of the financial services set up in Jersey. While that definition does allow for physical assets like land and gold, in reality today we are talking money.
Money is strange stuff. It has no intrinsic value. Its an abstract construct albeit one sometimes represented by physical tokens, but more often these days by digital storage on a computer somewhere. It represents exchange or interchange. When you have a reasonable free supply of goods and services money is a useful mechanism of trust between the parties to expedite those exchanges over an extended time period. That is it gets over the immediate problem of barter - where we both have to have items to exchange today. I can exchange my good/services today and expect to be able to get goods/services back in the future using money. Some people like to have lots of potential for future goods/services (eg a pension or similar) so aim to acquire money to provide for this.
Money is useful, so useful in fact that it has become something of a swiss army knife for life. However it is just a tool. Like any tool there are some craftsmen who can do amazing work with it, that might not be possibile otherwise. Thats how we end up with bankers and fund managers etc. In fact the tool has become ubiquitous and so useful has led us to forget what it is for. More importantly we have forgotten what are its limitations. We have become so accostomed to it we don't really think about doing things with any other tool.
However there are limitations to money. Read the previous paragraph carefully and you will see the caveat is that you have reasonably free supply of goods and services. There are plenty of examples where this free flow has been absent, and it pretty much follows money is of little use in those cases for example Zimbabawe currently, communist states in previous times. This is very relevant to us now. We have world wheat reserves at an all time low, and food riots round the world. Oil production is barely able to meet demand, and we are only discovering 1/5th of the amount we are using at best. We are at a point where fundamental resources for industy and living are both about to become hard to source. Put another way goods and food are about to start not being in free supply. We may be looking at 5 to 10 years for things to get seriously bad, but bad to catastrophic they will get.
In a theoretical economic world that would lead to an increase in production . Except here we are talking about primary resources they are physically limited by land, water supply, climate changes and the reserves of oil in the ground. These are hard constraints that no economics can bypass. Initially shortages like this will result in inflation -people want more money for the same goods and services. But with something as fundamental as drinking water or food or oil, once supplies get significantly short producers will use it to feed and support themselves and their family and countrymen before selling it on. Thats just human nature. Suddenly your money can't buy the stuff you really need. And Jersey wont be in a position to feed everyone here, at least not without massive upheaval. So how are we going to import essentials like food? If money is no longer a token of exchange, its value is minimal. Once you have devalued money you have undermined any need for a finance industry much beyond basic banking.
I am not saying the finance industry per se will necessarily destroy the island (though it could), but I am saying the finance industry will not be its saviour. Far from it the finance industry will struggle to exist. What will put a severe strain, perhaps even a breaking strain, on the island will be masses of unemployed ex-finance industry employees holding out their begging bowls offering useless money to those who do have something of real value. The greater we rely on the finance industry now the worse will be the problem when it is gone. I don't hold out much hope of all those non-finance people who have struggled to cope in these boom times rushing to set up soup kitchens for the impoverished bankers and fund managers of tomorrow.