As the country edges closer to the Brexit deadline next May, anxiety is rising for the post-Brexit landscape. Since the referendum back in 2016, EU workers have departed, leaving construction and manufacturing sectors struggling with persistent skills shortages and low business confidence. Both consumers and business owners have also been left with a sentiment of uncertainty and caution. Despite recent upturns in the economy and slow progress on trade talks with Brussels, the negative opinion of Brexit is still felt.
A report from the Bank’s 12 regional agents has revealed that 49 per cent of companies polled from February to April expect Brexit to have a negative effect on sales at home and abroad, compared with 42 per cent in the same period a year ago. The survey was the result of a discussion between the Bank’s agents and thousands of businesses across the UK, and across all sectors of the economy. The results illustrate how Brexit changed the business landscape, with its uncertain prospects encouraging hesitation with investment and general cautious behaviour.
The issue lies with self-assurance, or at least, the lack of it. Britain’s decision to leave the EU ate away at business confidence, with trade relationships and border mobility not immediately clear. The fear of an economic shift has guided business owners into self-doubt, and their business has suffered as a result. At the Credit Protection Association, we make an effort to restore financial confidence and stability. Our debt recovery services chase down unpaid invoices and award our Members with the financial assurance not only to reach the Brexit deadline next year but to proceed forward into the foreseeable future.
The report found that, on average, businesses expected around 3 per cent to be wiped off sales due to Brexit. Of the 4,000 companies polled, the 10 per cent most pessimistic expected a drop of 10 per cent in sales, while the most optimistic 10 per cent expected Brexit to boost sales by only 1 per cent.
The agents said Brexit was affecting businesses’ current investment decisions, especially among consumer-facing businesses where employment intentions are at their weakest level for this sector since 2009.
According to the report, suppliers of credit to consumer-facing businesses had also reported an “increased incidence of bad debts” and were expecting continued company voluntary arrangements (CVAs) and administrations as rising costs and over-supply put pressure on balance sheets.