With Brexit still dominating the news on almost a daily basis, Mayor of London, Sadiq Khan has added his voice recently, warning that a hard Brexit could result in a “lost decade of lower growth”. Khan says that a no deal outcome in which the UK departs the European Uniion customs union and single market is likely to cost our country half a million jobs and a massive £50 billion in lost investment by 2030.
Sadiq Khan’s warning comes as a result of the revelations from research he commissioned from consultant analysts, Cambridge Econometrics. As a result, Khan is calling on the government to change its strategy in future talks with Brussels on Brexit, claiming that the new analysis clearly shows why the government should alter its approach and negotiate a deal that allows the UK to remain in both the single market and the customs union.
The research carried out by Cambridge Econometrics models five possible scenarios for leaving the EU which range from a near status-quo situation to leaving ton World Trade Organisation (WTO) terms without any transition agreement. The report concludes that while every Brecit outcome would damage the UK economy, “the harder the Brexit, the more severe the economic damage could be”.
The independent economic analysis revealed some worrying issues, inlcuyding the fact that a hard Brexit would result in and reduction of £2 billion in the science and technology industries, tow of the most vibrant and innovative sectors in the UK economy. The cut in investment is likely to result in a massive 92,000 fewer new jobs in science and technology, more than 11,000 of which would be in the capital of the country.
London’s Chief Digital Officer, Theo Blackwell claims that a no-deal Brexit runs the risk of totally undermining the growth and development achieved in recent years with London falling sharply down the league table of global science and tech hubs.
The research also disclosed that a no-deal Brexit would have a disastrous effect on the jobs market in all sectors with up to 482,000 fewer new jobs and up to £50 billion of lost investments by 2030. The yearly average rate of economic growth may slow from 1.3% to 1.1% and business leaders are calling on the government to take action to safeguard jobs, investment and growth if we don’t want to risk turning the clock back on years of progress and threaten the UK’s future prosperity.
Bad news for the construction industry is that in the event of a no-deal hard Brexit, approximately 43,000 will be at risk in our sector by 2030. However, the industry is likely to see threats to jobs no matter what type of Brexit deal the government manages to negotiate.
The Mayor of London was a strong voice in support of the Remain Campaign and has continued to argue vigorously for the UK to remain in the EU’s single market and customs union or, alternatively, for London to be granted its own deal, particularly on maintaining rules on banking and financial services.