Survey unveils how UK business leaders’ hopes and dreams about Brexit simply don’t tally with European counterparts.
New research by Shakespeare Martineau reveals how confidence is high amongst British business leaders as they expect to prosper from Brexit, but warns that they are unprepared and lack robust plans, are overly ambitious about brokering new trade deals, and are heavily reliant on migrant workers to fill a widening skills gap. The message from this research is loud and clear – uncertainty is simply getting in the way.
UK independence Vs influence?
Nearly three quarters (73 per cent) of British business leaders believe the UK is strong enough to be independent whilst their European counterparts don’t think UK will get its way over the negotiations. Research delved into what business leaders thought the UK’s level of influence would be post-Brexit and less than half (41 per cent) of leaders believed it would increase after the UK leaves the union. Across the continent, nearly two thirds (59 per cent) of European business counterparts believe that the UK’s level of influence will reduce, and one third (33 per cent) believe that the UK simply isn’t strong enough to be independent of the Union.
UK business leaders need immigrant workers
With immigration being one of the deciding and key factors that led to the ‘out’ vote on June 23rd, UK business leaders are now painting a stark picture of the increasing reliance on the migrant workforce and the role they play in filling the skills gap. Almost three quarters (74 per cent) agreed that businesses require immigration to fill the skills gap, and over a third (39 per cent) want a reduction in ‘red tape’ in this regard. In addition to this, nearly two thirds (63 per cent) of UK leaders are expecting the flow of skilled workers into the UK to decrease and more than half (60 per cent) saying that migration restrictions will make the UK labour market less flexible to demand. Overwhelmingly, the research concludes that restricting immigration will damage prospects for businesses and their workers, and is patently unrealistic.
Underprepared for Brexit
The research found that British leaders’ were slow to implement plans and reticent when it came to taking positive steps towards being Brexit-ready. Nearly two thirds (61 per cent) say they hadn’t set up a Brexit task force to address the outcome of Article 50. Many businesses claim they don’t know what they are preparing for, what to expect, and how to implement plans when the majority of information from government isn’t definitive about implications. Businesses are operating in a vacuum caused by this state of uncertainty and the fog isn’t expected to clear anytime soon.
The split in Brexit preparedness is increasingly evident when it comes to the makeup of the businesses surveyed. Private equity-backed enterprises were more progressive and taking ready steps to deal with implications with over a third (35 per cent) having actioned plans already, whilst just less than a quarter (20 per cent) of family-owned operations claim they were considering changes.
A new hope for new trade?
A clear and consistent message was that leaders believe that Brexit’s biggest risk relates directly to trade with more than two thirds (68 per cent) of leaders believe that Brexit presents them with the freedom to strike new trade deals. However, this optimism is tempered somewhat by the responses from the EU panel with over three quarters (79 per cent) warning that the UK has overestimated the EU’s willingness to accommodate its requirements. There appears to be a more telling story with the majority (78 per cent) believing that the costs of imports will be a negative force, with just less than three quarters (71 per cent) believing that the loss of access to parts of the single market is a further detriment.
Shakespeare Martineau surveyed 426 mid-market British leaders, and a further 54 from across European Union member states to understand sentiments towards the situation, where they believe the risks and opportunities lie, and what actions they are taking in preparation to capitalise on the negotiations. The majority of these businesses have a workforce of between 50 and 250 employees, and a market capitalisation ranging between £20m to £130m.
Andy Raynor, CEO of Shakespeare Martineau, said: “Business are flying blind, but they are flying nonetheless. And, in the absence of information, they are charting their own reality to get on with business.
“Our research compounds what we are living and breathing everyday through our interaction with clients - these are uncertain times but we are working collectively to try and navigate our organisations’ through an information vacuum. The confidence shown in the report is welcome and mid-market leaders need to embrace the uncertainty. Those who take action now to prepare and plan for the whole host of potential variables can be ahead of the curve and capitalise on the current state of flux. As business leaders we simply can’t rely on central Government to hand us opportunity amidst all the Brexit chatter, it needs to be tackled with true entrepreneurial spirit in order for organisations to survive, prosper and maintain a positive direction of travel.”