This article was first published in ePrivate Client and Times of Tunbridge Wells.
We 140 businesses across the UK’s key sectors, including banking and finance, property and agriculture to gauge the current market sentiment ahead of the UK’s anticipated date of exiting the EU, 29 March 2019. The vast majority of respondents (94% and 91% respectively) answered in two consecutive surveys across the Autumn that they had not changed their mind since the Brexit referendum in 2016. This response is instructive in the context of a second Brexit referendum being considered across the political spectrum.
In addition despite concern from respondents about the economic prospects over the next year, there is also a positive long-term outlook with 58% of respondents in the October survey saying that they are either quite or extremely confident that the UK will thrive outside the EU. This is bolstered by a high level of confidence that businesses will be able to access their supply chain after 29 March 2019 – in the November survey over three-quarters (76%) stated that they were similarly confident about this.
The firm has been taking the pulse of public opinion since 2016, immediately after the Referendum vote, with the questions designed to evaluate business sentiment on the impact of Brexit. A second survey was completed in 2017 to compare the survey responses. The most recent ‘Brexit Barometer’ took place in October and November this year and will run until April 2019 – the objective being to continue to measure how business sentiment and concerns relating to Brexit are changing month by month against the backdrop of fast-moving political Brexit developments.
Other key statistics from the Autumnal 2018 surveys, included:
- Over a third of respondents (36%) identified a greater ability to engage in free trade deals with other countries as the main benefit of Brexit, followed by over a quarter (28%) choosing less regulation as the main benefit.
- 32% that they were not at all confident of Britain thriving outside the EU.
- 34% of respondents stated that the biggest concern for businesses is the impact that Brexit might have on prices and exports/imports.
- Nearly three quarters (73% ) of respondents answered that the Withdrawal Agreement has not made them rethink their business preparations for Brexit.
- Concerns arising from Brexit, included prices and exports (34%), access to the single market (24%) and business dependence on migrant workers (15% in November.
- Nearly half of the respondents (42% in November) do not feel confident about the UK economy in the next 12 months.
In terms of business planning, the Barometer indicates that half (50%) of businesses’ mergers and acquisitions plans have not been affected at all by the Brexit decision. Moreover, 44% of respondents in October and 45% in November shared that they did not include Brexit clauses when negotiating new/updating existing commercial contracts. This contrasts with only 9% of respondents who answered that they did include a provision in commercial contracts relating to Brexit.
When questioned about their biggest concerns arising from Brexit, the standout areas were prices and exports (34% in November), access to the single market (26% in October) and business dependence on migrant workers (15% in November). Other concerns included, employment law issues and investor confidence.
Joanne Gallagher, Partner and Head of the Corporate team at Thomson Snell & Passmore, comments:
“Although there is still uncertainty about what the impact of Brexit will be, our Brexit Barometer clearly shows that businesses recognise that there are opportunities for Britain outside of the EU, including the greater ability to do free trade deals with other countries and perhaps less regulation.
Our Brexit Barometer suggests there is greater confidence from the SME marketplace about Britain’s future than some politicians suggest. It will be interesting to see how this confidence develops over the next few months.”