The Bank of England (BoE) has released a new paper delving into the impact of Brexit has had on the UK as a state.
Developed from a new survey of UK firms, the Decision Maker Panel, the report finds mostly negative effects due to the process causing a “large, broad and long-lasting increase in uncertainty.”
Furthermore the BoE discovered over the three year span since the June 2016 vote, investment levels have fallen gradually by approximately 11%.
The report states: “One possible explanation for this more gradual response of firms to the Brexit vote is that the huge uncertainty surrounding the process and its persistent nature may have led firms to act cautiously and not cut investment as quickly as might have been expected based on evidence from previous more modest and short-lived uncertainty shocks.”
Productivity also appears to have taken a hit during Brexit procedures, the report found average levels to have fallen between an estimated 2% and 5% over the three years.
BoE examined multiple sources of data including a reach out to senior management officials asking: “On average, how many hours a week are the CEO and CFO of your business spending on preparing for Brexit at the moment?”
This method found – between November 2018 and January 2019 – 10% of CFOs and 6% of CEOs were spending 6 hours or more a week on Brexit preparations, with over 70% of both CFOs and CEOs reported spending some time each week on Brexit preparations.