The economy is starting to be affected by Brexit, according to this report (HERE) by the Chartered Institute of Procurement and Supply (CIPS). About 11% of manufacturers say they have already lost contracts, 58% are planning price increases and over a fifth are planning job cuts to offset the costs of Brexit.
John Glen, a CIPS economist, said,
“It’s becoming clear that manufacturers can no longer absorb the costs of Brexit, and so the burden of higher prices is spreading to consumers, to suppliers, to clients and reshaping supply chains, though the sector has moved further towards inshoring, they’re likely to have difficulty finding suitable alternatives in the UK. Businesses that fail to plan ahead and use this opportunity to reduce their costs in supply chains may not survive.”
And Stephen Phipson, chief executive of the manufacturers’ association EEF, said he was concerned that smaller companies were not preparing for a bad outcome from the Brexit talks.
“The more I speak to companies, the more I am concerned that there is a body of smaller and medium-sized companies that have no contingencies, or even thought being put into what happens in the event of the Brexit negotiations not going to plan. Our overarching asks to government are to keep the conditions for trading as close to today as possible."
Inshoring jobs is good but this will mean at best no job losses with people having to be laid off and then seeking new employment. Some may find it, many will not. This will be the story over the next few years as we lose EU trade and open up new markets. Whole industries will be at risk, change will be the new normal. Farming will be badly affected if we sign an FTA with the US for example. In my experience, the thing that most people are averse to is change and although many were dissastisfied with the status quo there is no guarantee they will be happy with what comes after. Brexit will bring us nothing but change - but it will not be for the better.
