Brexit's Economic Impact and Challenges

May 27, 2025

Notes on the Lecture about Brexit and Economic Impact

Introduction

  • The mini-budget reflects the culmination of economic policies post-Brexit.
  • The concept of sovereignty vs. economic sensibility discussed.

Effects of Brexit

  • Claim that Brexit is an act of economic self-harm in terms of prices, investment, and trade.
  • Negative Brexit effects are evident, not due to the pandemic or energy crisis.
  • UK has ended up with a hard Brexit with limited trade agreements.
    • Not part of the European Single Market.
    • Only a bare-bones Free Trade Agreement.

Trade and Economic Indicators

  • Post-Brexit trade recovery appears flat compared to other G7 countries.
  • Significant drop in trade relationships for smaller companies in the UK.
  • Estimates show a loss of about 470 pounds per person in long-term wages due to Brexit.

Business Challenges

  • Small businesses faced increased bureaucracy and costs.
  • Examples:
    • Aston Chemicals experienced rising freight costs.
    • Kieran Towdy's tea company struggled with customs delays and shipping complications.
    • Little Star Jewelry had to adapt by relocating business operations to the EU.

Economic Growth and Investment

  • Business investment has plateaued since 2016, unlike other G7 nations.
  • Government attempts to stimulate investment, such as the super-deduction scheme, have not significantly improved the situation.
  • Perceptions of uncertainty hinder investment growth.

Employment and Recruitment Crisis

  • Post-Brexit recruitment issues in various sectors like hospitality and agriculture.
  • End of free movement has caused disruption, necessitating a reevaluation of certain industries.

Northern Ireland and EU Relations

  • The Northern Ireland protocol is creating trade tension between the UK and EU.
  • Northern Ireland benefits from a unique economic position, being part of both UK and EU markets.

Political Silence on Brexit

  • A political conspiracy of silence exists regarding Brexit's negative effects across political parties.
  • Economic discussions surrounding Brexit are often avoided, leading to a lack of honest debate.

Public Perception and Awareness

  • Public awareness of Brexit's impacts seems limited; many remain unaware of the realities faced by businesses.
  • Younger generations are particularly affected by Brexit's restrictions on mobility and opportunities in Europe.

Conclusion

  • Brexit has resulted in economic drawbacks that disproportionately affect poorer communities.
  • The trade-offs of sovereignty vs. economic benefits are clearly laid out, but not often discussed.
  • The future trajectory suggests a slowing economy and less productive job growth due to Brexit, highlighting the importance of honest political discourse.