Whatever option you voted for, the outcome is same for everyone – the UK has officially decided to leave the European Union and it comes with both costs and opportunities. We’ve waited a month for the hype to cool down and it is now time to see what lies ahead for the manufacturing sector.
Nothing is clear yet with regards to how Brexit will be affecting the country. It is quite likely that the UK will retain some of the free trade agreements with the EU but we will only know for sure in a few years once all the arrangements are made.
One of the issues that was present before Brexit and will be experienced now to an even greater extent is skills shortage. If EU workers are no longer able to freely work in the UK it will put more stress on the industry. The things to do now would be to attract younger generations to manufacturing and engineering industries and to somehow retain non-UK talents. The government needs to keep the image of the British manufacturing industry positive and attractive to other countries and businesses to invest in.
Another issue is free movement of goods and services within the EU and UK. Unless it is properly negotiated it might result in extra spendings and much longer time periods spent in logistics queues.
The recent pound’s depreciation might have a positive affect on exports as they are now becoming cheaper to the EU countries, which would in turn boost sales for UK manufacturers. This is especially relevant to the automobile industry, as about 80% of all vehicles manufactured on UK grounds are going for exports.
The main problem with Brexit is that the level of uncertainty about its possible consequences keeps getting higher and higher and leads to a lot of speculation. Businesses want to take action about it as soon as they can but no one knows what those actions should be and this uncertainty only makes it worse. An important thing to remember is that Brexit is also an opportunity, not just an implication and long-term decisions should now be in priority.