There are many reasons stating why Brexit was triggered. There are 3 reasons the brits voted for Brexit, economics, sovereignty, political elitism. When it comes to economics most of the British people believe that jobs and financial opportunities are being taken away by immigrants. They also believe that foreign competition is killing their companies and stealing their clients. The second reason for Brexit is sovereignty, the rise of nationalism across the world. There’s a growing distrust of multinational financial, trade, and defense organizations created after World War II. The EU, the IMF, and NATO are good examples of this. Many people who oppose the EU believe that it is of no use to their country and that they are better off alone.
The last reason for Brexit is political elitism the political leadership of Britain faced a profound loss. The ‘leave’ voters rejected both the Conservative and Labor parties. Both parties had endorsed remaining with the EU and saw many of their members go into opposition on the issue. It was a three-way struggle. Two parties wanted to remain in the EU, and a third party separated from both parties, they opposed them. People in this third group saw both of the establishment parties as hostile to their interests. These are the main reasons Brexit was triggered.
Who started and created Brexit? “Brexit is my fault”, – stated Peter Wilding. Peter Wilding, the chairman of British Influence, created the word Brexit. He claims, that he is ‘neither a phile, nor a phobe’, which means he is neutral. He says, that he’s a realist and he isn’t on anyone’s side. On the end of March 2017, the Brexit process began. Prime minister Theresa May stated that by the end of April 2019 Britain will most likely leave the EU. Theresa May is 62 years old and is the prime minister of England. She became PM on the 13th of July, 2016 and served as Home Secretary from 2010 until 2016. Theresa May was first elected in 1997. She was the longest-serving Home Secretary, and is greatly respected in the government.
It is official and set in stone Britain will leave EU on 29th of March, 2019. “I will deliver on my promise and that is a promise!”, – stated Theresa May, before her negotiation deal. The British people wants to keep on moving forward with Brexit, but unluckily Theresa May’s deal has been declined by the EU’s MPs (members of parliament). Theresa May lost the deal vote by a large margin, but she promises to deliver on the British people’s instructions to leave the EU and she intends to do so. Now that the British government now what the EU doesn’t want, they plan on inviting MP’s from all parties to come together creating a new deal.
Since Britain’s decision to leave the EU, there have been various changes that have already taken place and had both positive and negative impacts on small to medium sized businesses that operate in the UK. These changes will be the one of the two focuses of this essay. The other focus will be on the changes that are likely to take place after the UK has left the EU in March 2019, and the consequences of these changes on UK small to medium sized businesses.
One of the first changes that impacted UK businesses was a fall in the value of the pound. After the Brexit decision, the value of the pound fell significantly. It since has been trading at approximately 15% lower compared to the dollar and 12% lower compared to the euro than was the case previous to the EU referendum (Bowler, 2017). The nature of the effect that this has on businesses depends on whether a business exports or imports a higher volume of goods/services. A fall in the UK’s exchange rate means that UK exports will appear cheaper to consumers overseas. This makes the UK more competitive and will likely mean that more companies overseas will purchase from UK companies. This has proved true for some companies. For example, Cocofina, a coconut product company, have seen a 40% growth in exports since the referendum, which has been caused by the weaker value of the pound. However, they have noticed that new customers are scared about committing to the company because of the uncertainty that customs tariffs and complicated paperwork bring (Pay, 2017).
For companies that import large quantities, the fall in the exchange rate will mean an increase in the costs of running their businesses, due to the rise in the costs of imports from overseas. Baxter Freight, a company with 50 employees, had been impacted by the fall in the value of the pound, and passed the costs onto their customers (Isaac, 2016). The same will have been the case for other UK SME’s who import goods and services. Where higher prices are passed onto the consumer, depending on the good/service in question, they may choose to shop elsewhere or postpone their purchase. SMEs are more likely to be affected by this than larger companies because of economies of scale. Larger companies may be likely to achieve a lower price on their imports than SMEs because they can buy in bulk. Where this is the case, they should be able to charge a lower price than SMEs and so customers will choose to buy from them as opposed to SMEs. However, a limited number of companies had passed the extra costs onto consumers due to the high level of competition they face (Monaghan, 2016). Whether or not SMEs decided to pass the additional costs onto consumers, they will have lost out, either due to lower profit margins or a loss of demand. This shows one of the ways in which the Brexit decision has been damaging to some SMEs.
Another impact of the weak pound to take into consideration is the growth in tourism that it caused after the referendum. Spending by tourists had significantly risen following the Brexit decision. Spending from international tax-free shopping in July 2016 rose by 7% compared to the figure in July 2015 (Rodionova, 2016). Department stores and specialist retailers had reported a successful month for sales (Allen & Monaghan, 2016). It could be the case for some companies that these benefits may outweigh or reduce the impact of the negative effects that have come from the higher costs associated with the weaker pound.
It is unclear whether the positive or negative effect of the fall in the pound has been stronger. It will be different for each SME, depending how they operate day-to-day. However, given Britain’s ongoing trade deficit, it is likely that more SMEs will have experienced a negative effect.
A big issue that SMEs face from now up until the UK leaves the EU is uncertainty. A range of problems have been caused by this e.g. SMEs deciding to postpone investment decisions, and companies fearing that they will lose demand from their customers located operating in other EU countries. Polydron, a 13-person company, were thinking about having an expansion. This was until the outcome of the EU referendum was revealed (Gordon, 2016). Mark Sumners, a UK based aircraft manufacturer, is concerned that his biggest customer may shift their supply chain back within the trading bloc after Brexit (Gordon, 2016). These are just two examples of the problems and many SMEs will have experienced similar. However, Carolyn Fairbairn, CBI’s director general believes that businesses can cope with challenge and can adapt to change (Lysakowska, 2016). Also, many groups questioned by Business West think that the future will be positive and that UK companies are able to get past any short-term problems (Gordon, 2016).
The workforce is a major part of any organization. For UK SMEs, the Brexit decision has left them uncertain of what will happen once we have left the EU. For Tony Hague, chairman of Manufacturing Assembly Network, the ease of access to a skilled workforce is a concern. He fears that the standard of education in the UK has resulted in a small amount of talent in the domestic workforce (Isaac, 2016). Costs of labor are also a concern. A halt in the freedom of movement would raise the competition between businesses for labor, resulting in a wage increase. This is bad news for many SMEs as they rely on low-cost labor (Lemos, 2016). However, the benefits of the potential employment law relaxation when we leave the EU should be weighed up against the effects of losing the overseas pool of labor. Many SMEs are hoping that an end to following EU legislation will bring more flexibility to adjust their future workforce (Isaac, 2016).
Once we have left the EU, the current funding to UK SMEs from the EU will most likely come to an end. There are many SMEs in Wales that receive funding from the EU or use the Jobs Growth Wales scheme, which has been cut due to concerns about future funding. It is unknown whether any funding will be replaced by the central or Welsh government. Because of this, SMEs are at risk of struggling to maintain operations at their current size (Isaac, 2016). The UK also runs other support schemes for SMEs e.g. Innovate UK. However, there is hope. When the UK has left the EU, we will start to save a lot of money which previously would have been spent on EU contributions. It is thought that some of these savings could be used to help fund SMEs (Lemos, 2016), but whether this will happen is unknown.
Arguably one of the biggest advantages of EU membership is the access we have to the single market. This gives businesses direct access to a customer base of around 500 million and is the world’s largest trading bloc. Leaving the EU means we may lose these benefits, which will be damaging to SMEs (Davis, 2015). However, Theresa May has revealed that the UK may form a near identical Customs Union with the EU after we have left, but this may mean that the UK may have so stick to a lot of the bloc’s rules although this may be unlikely to happen due to a Conservative think tank saying that they could stop a final deal unless we leave the Customs Union and the Single Market (Deacon, 2018). A thing to note however, is that the UK, upon leaving the single market, will be free to negotiate trade deals with the rest of the world, without being held back by rules and regulations, which could be a huge benefit to SMEs due to the increase in demand that they will gain.
Overall, up to yet, the short-term implications of the Brexit decision have been more damaging than beneficial to UK SMEs. The high level of uncertainty, combined with the fall in the value of the pound have greatly affected the operations of a lot of UK’s SMEs. It is impossible to tell whether the event of Brexit will be more of a benefit or a danger to SMEs because a full deal is yet to be negotiated. However, it is likely that businesses will be able to adapt to the situation once it arises.
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Brexit. A word that rolls of the tongue with ease is in fact a heavy, oft-sour topic. The political turmoil caused by a vote passed in 2016 is not going away anytime soon. The media framing of Brexit is polarizing. Citizen discord permeates through social media sites, news outlets, and the streets of cities. The only united front is the frustration at an ongoing struggle with no end in sight. Questions sprout from the foundation of Brexit as quickly as weeds grow. The question I am using to focus to my analysis is centered around the observation made by Irish author Fintan O’Toole, “I realized there’s a bigger question, which is how does a very successful, relatively wealthy, very settled-looking democracy start to imagine itself being intolerably oppressed” (Booth, 2). Beyond this frightening rise of alt-right conservatism in Europe, the tendrils of British politics extend further; creating socio-cultural, economic, and geopolitical implications both domestically and across an ocean. Through the rise of global populism, Brexit was birthed with the advent of President Trump and his xenophobic rhetoric poking light for the alt-right to breathe freely without fear of repercussions. The influx of migrants led to a push for a Leave vote. The economic state of the UK is a status that all three sides of the issue fret over. Vote Remain and two separate Leave campaigns: Vote Leave, and Leave EU, respectively, have framed the issues in light of their agendas.
Since the 1970s, the relationship between the European Union and the United Kingdom has been less than amicable. An island nation made up of England, Scotland, Wales and Northern Ireland, the UK has been withdrawing from central EU policies for decades. Yet its full member status forces adherence to certain policies such as free movement. Free movement of EU citizens is their right to study, live and work in the European Union visa-free. However, an unprecedented, and what former Prime Minister David Cameron called “unsustainable” migration wave of over three hundred thousand people in 2015 drove the decision to hold a referendum to decide the fate of the UK and its membership. “The UK’s situation is unprecedented; no full member of the EU has ever left” (McBride). Despite seeking and gaining EU reforms, the waves of migrants, coupled with devastating terrorist attacks across Europe, was too much for the Eurosceptic United Kingdom Independence Party (UKIP) to handle. Eurosceptiс is exactly what it sounds like; a political doctrine that promotes disengaging from the EU. With a platform rooted firmly in anti-immigration and broad populism, similar ideologies can be found among conservative American political parties (Roth, 501). This push for strengthened borders and fears of vulnerability to terrorist attacks, Leave won on June 23, 2016, and the messy process of divorce began.
Across the Atlantic, the United States was dealing with its own unprecedented political quagmire. Donald Trump, a former reality television star, had won the 2016 US Presidency. Questions swirled around his rise and ultimate selection with no experience. A podcast discussing Trump, Brexit and the rise of populism help provide answers. Populism, in this case, is a way of doing politics framed as a battle between the people, and a corrupt, nefarious elite. The goal of populist rhetoric is to impose a single popular will. Today this language surrounding the ‘common people’ has become synonymous with hyper-conservative groups. Despite the concepts high association with conservative groups populism can be found on any side of the political spectrum: left, right, and center. On the rise for the past two decades, populism tends to flourish in countries where the people have grievances about the political establishment failing them. What is new, is populist leaders being elected in really big countries with really big populations such as the United States. Both Donald Trump (when scripted), and current Prime Minister Theresa May share populist views, delegitimizing those they disagree with and placing focus on the ‘common people’ experiencing hardship at the hands of the government (Asthana). What this ‘hardship’ is however, is not clearly defined.
Determining what the interest are of the common people is dicey. With three sides to this story, media outlets work to construct multiple frameworks to encapsulate it. According to the Council on Foreign Relations, “Brexit supporters argue that the EU threatens sovereignty and stifles growth, while opponents counter that EU membership strengthens trade, investment, and the UK’s standing in the world” (McBride, 1). Opponents of Brexit have decades of a highly integrated relationship between the UK and the EU that established the terms of migration, trade, and investment on their side. Adam Posen, president of the Peterson Institute for International Economics has little faith in the pro-Brexit economic plan. He argues that migration has been a positive influence in economic growth, while belonging to the EU has bolstered the UK’s ability to trade through the larger bloc negotiating desirable deals. The UK’s standing in the world is not only impacted with its relationship with the EU. Ties to outside countries like the United States could be impacted by Brexit. In an interesting point about sides, Former President Barack Obama was against Brexit, arguing that EU memberships aids US interest. The current president however, has praised the Brexit vote (McBride, 10). While there is no ‘right’ or ‘wrong’, the rise of fierce anti-immigration rhetoric among the Independence Party draws concerns about whose voices are being privileged under the guide of an ‘oppressed’ group.
The concept of populism, oppression, and the demographic that makes up the majority of supporters for Brexit draws interesting comparisons to the United States political state. According to Silke Roth in his article, ‘Contemporary Counter-Movements in the Age of Brexit and Trump’, the similarities are too close for comfort, “Second, a closer look at the supporters of the ‘Leave’ campaign and Donald Trump’s candidacy reveals that demographic includes middle-aged and older middle-class, college-educated men and women” (Roth, 502) These supporters of Brexit emphasized that predispositions toward Leave were brought about by socially conservative views, values, and a strong sense of English identity. The accompanying vague slogan to “take back control” dispensed by supporters is MAGA with a cup of tea.
Since Leave won, there has been push from both citizens, and the media outlets to reclaim any semblance of a narrative in this perpetual time of Brexit issue. Mikaela Hellman points out the split in narratives in in her article ‘What’s in a Frame? Media Framing in the 2016 ‘Brexit’ Referendum’. Brexit’s public debate is firmly entrenched between two camps, each with their own arguments: pro-EU supporters pushing an economic agenda while more Eurosceptic citizens focus on arguments related to national identity (Hellman). Ironically, both sides point to the economic risks as the most imperative issue. There is a sense of the truth being pulled from all sides, stretched until it fits the canvas framed in ‘fact’. Americans can sympathize with this divisive split in politics that feels both personal and infinitely larger than ourselves.
These camps spill over into the British papers as each struggle to represent what they believe to be the most salient issue. The politics of the image of Brexit is a bold question asking whose politics are being represented in the first place, via the image itself. Freedan makes a salient point through his analysis of British newspapers through the lens of populism. “Reporting on the High Court judgement regarding Article 50, the pro-Brexit press emphatically evoked a stark populist dichotomy: ‘The judges vs. the people’ was the front headline of the normally austere The Daily Telegraph; while the Daily Mail went one further with ‘Enemies of the People’ under the front-page photograph of the three High Court judges” (Freedan, 6). The Daily Mail is a tabloid paper. The Daily Telegraph is a broadsheet but both are conservative leaning publications. Article 50 of the Lisbon Treaty was the trigger Theresa May pulled in order to begin leaving the EU, before the process could begin however, the government would need Parliament’s consent in order to begin, which for conservatives filled them with that same old anger at government overreach. The story, typical of hyperbolic tabloid papers was full of misconstrusions and base insinuations about one of the High Court judges sexuality. Flipped over to The Guardian, a recent headline from the left-leaning broadsheet said, “Brexit teens: coming of age during political chaos”. This is who suffers.
The suffering is not limited to the young adults and migrants caught in limbo of Brexit. With the rise of populism, coupled with the schism between news outlets, it is no wonder that real fears of political violence lurk. In the wake of another six month push back to the apt date of October 31, tensions have risen to a breaking point. According to the United States based news outlet The Intercept highlights the indelible fear as ‘Specter of Far-Right Violence Haunts Crisis Talks Over Brexit’. Robert MacKey published the story in early April of this year, revealing nationalists in the streets dragging an efigie of Theresa May through the streets. Parliament members fear for their lives as Members of the House are threatened for their contrary views on Brexit. Congress members in the States can also relate to these fears as the President has stoked xenophobic rhetoric among his nationalist demographic. In a fearful twist, this group utilizes new media logics to spread their hate filled messages. According to MacKey, British soldiers used a photograph of opposition leader Jeremy Corbyn for target practice and posted it on Snapchat. The video was then shared on Twitter by current and former members of the British armed forces. The spark that ignited this anger was Corbyn emerging from talks with Prime Minister Theresa May, aimed at finding a way to allow the stalled British exit from the European Union to proceed (MacKey). In effect the Brexit conversations are stuck in a ‘damned if you do, damned if you don’t’.
Chaos perpetuating this process is dominantly absent from the broader European media landscape. According to a Reuters Institute Report by Alexandra Borchardt, titled ‘Interested but not Engaged: How Europe’s Media Cover Brexit’, the coverage outside of the UK was predominantly fact based. “The biggest share of the reporting is dedicated to the progress of the negotiations and political questions surrounding them. Economic questions dominate the issue-related coverage of Brexit, and the rights and future of EU citizens living in the UK or vice versa play a minor role” (Borchardt, 43). Meanwhile, the citizens in the UK currently living through Brexit are framed in a medical term, that demotivate citizens political motivations and actions, with the idea that they have no political control. According to Degerman, “To paraphrase the political theorist Hannah Arendt, in politics, where we are always dealing with a plurality of ever-changing relationships between people, sovereign control is an illusion” (Degerman). This makes the interactions between media logics and political mobilization even more important for the citizenry if they want a voice in the Brexit proceedings. The Prime Minister has lost control of her power, her government, and her citizens. Already pledging to relinquish her position, the new Prime Minister could change the trajectory of the country within days. Nothing is for certain. Young people can use this as motivation for political engagement in order to ensure that the next Prime Minister represents what they want to change in the current system.
While Americans voiced their discontent with Trump’s presidency through street protests, and a poorly attended inauguration event, the subsequent protests following Brexit were digitally based. According to Roth new media logics play out with increasing importance through social media, “In contrast to the broad-based mobilization against Trump, the protest against Brexit appears so far to play out primarily on social media, for example, on Twitter and Facebook, where one can find and follow groups such as @ScientistsforEU and @The3Million, whereas street protest events appear rarer” (Roth). Populism comes in waves, and both the UK and the Unites States find themselves in the midst of a wave right now. The Guardian’s Paul Lewis speaks on the quantification of populism and how it spreads. He believes that the issue is not only wrapped up in technology but brings awareness to the permanence of technology through all the changes it creates within its internal structure, and the structure of society that social media permeates in a new and dangerous way. “I wonder whether the types of discourse that are being encentived and encouraged by the platforms which are completely dominate Facebook, and Twitter, and Youtube and the like; the sensationalism, the simplification reductionism, the division is becoming part and parcel of the way we do politics now” (Asthana). The use of sensationalism by the British Army reflects the issues that come with the integration of social media and political discourse. There is fear that this wave could turn into an ocean, bringing along the repercussions of populist rhetoric: reduced press freedoms, and extended reach in political offices.
A wave of historical nostalgia is a part of the overflowing Brexit tide. Audiences who are pro-Leave revel in a deep nostalgia for empire. The strength of this empire is highlighted through pop-culture which sanitize violence pasts and rewards nationalist ideologies. Films like ‘Dunkirk’ reinforce the notion that the UK is historically stronger when they stand alone, erasing decades of transnational collaboration between nations in lieu of reclaiming a deeply seeded racism in order to ‘take back control’ of their country. This rhetoric is wholeheartedly embraced by the white elite who pushed for the Leave vote in the UK and elected Donald Trump to his presidency.
What will the UK look like in the wake of Brexit? The question will continue to reveal itself as the October 31 deadline draws ever closer. Until them, citizens of the UK will continue to utilize media, both old and new, to disseminate information about the process of Brexit and the implications of its outcome. The marginalized are recognized. While the elite may have called for this vote, what the course of Brexit has revealed is that the will of some is not the will of all. For now, we can only do what we have done for the past three years. Wait patiently, and actively voice discontent when those that spread ill-will and xenophobia rise into power. The wave of populism may be here for a while, but we can learn how to swim, and help others stay afloat.
It has been 4 years since the results of the Brexit referendum on June 23rd, 2016 and the world waits with bated breath to see the deal penned down by the negotiations between representatives of the European Union and the United Kingdom. Spurred on by the wave of nationalism and fueled by issues of unrestricted migration, high budget contributions, restrictive trade policies and the bureaucratic nature of the European Parliament, the UK decided to withdraw its membership from the European Union. Uncertainty in the financial and investment market has led to a free-fall in the value of the GBP, as the threat of excessive tariffs and trade barriers looms large in light of a no-deal situation. FDI flow into Britain has slowed down to a trickle, as wary investors wait for 31st December 2020, which marks the end of the Brexit transition period.
Countries like India and Bangladesh, which used Britain as a launching pad for the larger European market, have increased trade with their former coloniser; India now stands as the UK’s 17th largest trade partner (Office for National Statistics Pink Book for 2019 Goods and Services). The large influx of Indian workers into the UK, along with the more than 800 Indian companies which have set up operations there, ensure that signing a Free Trade Agreement with India is a priority for smooth trade to continue. An important aspect of trade between these economic giants is the high demand for premium goods by affluent Indians, and the ability of English luxury brands to satisfy that need.
However, Brexit threatens to derail this trade. According to Walpole, the trade body for the British luxury sector, sales are estimated to grow to between 52 billion pounds and 60 billion pounds if the UK and the EU cannot secure an agreement, in contrast to the value of 65 billion pounds otherwise. The sector is worth 48 billion pounds to the economy, with 38 billion being exports, and provides direct employment to over 150,000 people. The luxury car segment, headed by brands like Jaguar Land Rover (owned by Tata Motors), Bentley and Rolls-Royce, is lobbying to secure open European borders for its outsourced and multi-national manufacturing processes, while fashion brands like Burberry, Harrods and Mulberry vie for easy access to top designers from places like Milan, Paris and Barcelona.
While the underlying economics is static, differences in assumptions and focus of study have led to a dearth of material on Brexit’s impact on luxury markets in other research papers. It is also not correct to correlate economic openness and productivity growth without an empirical backing, which necessitates the requirement of looking at this from a long-term perspective.
The implications of hostile relations with the EU on the luxury goods market are worrisome, as restrictions to the free movement of manpower and materials across the continent severely hamper the ability of companies to enjoy profitable margins. While established brands may escape this conundrum by passing on the costs in the form of increased prices to the customers, indigenous startups serving a critical consumer base have no choice but to double-down their expenditure, in an attempt to increase sales exponentially. A stark reality which faces these brands is the possibility that their primary non-EU importers (USA, China, India) use this recent upheaval in global trade to negotiate better trade terms with the European Union, leaving the UK in a lurch. It is also imperative for London-based companies to locate talent internally, as closed borders may become the new normal soon.
There is also a strong likelihood that the UK might join the European Economic Area, for access to a single market for movement of goods, capital and labour. While this move is beneficial for Indian companies as they retain access to the European market, British companies will continue to be subjected to conservative policies of the Union. The country might also accede to the World Trade Organisation, in hopes of setting its import-export policies. Key companies, especially in the luxury automobile segment, are looking to secure favourable bilateral treaties with major importing countries. More liberal policies (eg. relaxed competition laws) would entice countries like India to contribute higher amounts as FDI, with Indian companies carrying out mergers and acquisitions with UK-based companies.
Finally, the surplus amount tied up in EU budgetary payments can be invested in the enhancement of vocational training institutes, to train skilled designers and workers for manufacturing premium fashion goods. Brexit can therefore, in the long run, pave the way for India’s integration with the rest of Europe and strengthen its trade relations with the UK. Once the dust settles, the UK is likely to overcome the short term recession and emerge as a liberal independent economy.
Today’s most discussed topic all over the world is the fact that UK will possibly leave the EU. On Thursday 23 June 2016 a referendum was held in order to come to a decision if the UK should remain a member of EU and more than 30 million people have voted. Brexit was originally planned to happen on 29 March 2019. That took place two years later when Prime Minister, Theresa May, set off Article 50 and started with the negotiations (BBC, 2019). This, might cause some implications in free trade with businesses. Initially, free trade can be expressed as the movement of goods and services among nations without political or economic barriers. This also means that trade will be without any restrictions, tariffs, quotas or other forms of restrictions. International trade has also an essential importance which is very important form of trade because it plays a very decisive role in the overall economic activity of nations. That type of trade allows countries to exchange goods, services and factors across national borders. International Trade also cause impacts on domestic and global economies too. Moreover, countries have created groups with trade agreements which let countries to have a common external tariff, no internal tariffs and a coordination of laws to facilitate exchange. Some of them are NAFTA and CAFTA. NAFTA is the North America Free Trade Agreement. More specific, is the creation of free trade area and conditions among United States, Canada and Mexico. In 2005, CAFTA or Central American Free Trade has established a free trade zone with Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua.
The European Union is officially the largest trade partner. About half of the UK’s trade is with the EU. So, leaving the EU will probably low the trade between the UK and the EU thanks to the high rise of tariff and non-tariff barriers to trade. By merging the future market within the Europe, UK would gain less from the upcoming market. The main economic benefit of leaving the EU would be a lower net contribution to the EU budget (Dhingra et Al., 2016). Obviously, the members of EU have the privilege to importing and exporting goods without any restrictions. The benefit from being member of the EU union is that, all tariff barriers have been taken out and free trade is been accepted by all, as a free movement. Certainly, it is uncertain what is coming by the economic future and it is always hard to estimate these effects.
However, it can be guaranteed that by reducing trade, UK will end up with living standards’ issues. To begin with, there are two possible scenarios, one optimistic and one pessimistic. According to an ‘optimistic’ scenario, which is called also as ‘Soft’, UK will manage to have free access to the EU single market. After analyzing the effect, the result ended up to an overall 1.3% fall in UK incomes, more specific £850 per household (Dhingra et Al., 2016). Dhingra (2016) states that, the EEA association was established in 1994 to give countries that are not members in the EU a way to join the Single Market. Burke et Al (2016), also have agreed with the above statement by adding extra information to this stating that UK after leaving the EU connected with the benefits gained by the maintenance of the UK’s position will be able to contribute in the Internal Market with more free regulatory structure.
By being a member of EEA, UK would widely not discard its privilege of accessing into the Single Market and cherish all of the economic and trading significands with EU. UK will also be the linking part of the four freedoms which Single Market offers. EEA members need to pay some fees to continue being part of the Single Market. By subscribing to the EU budget, UK will continue being the 91% of the levels of the UK contribution. In 2011, Norway’s contribution to the EU budget was £106 per capita which means only 17% under the net contribution of £128 per capita of UK (House of Commons, 2013). As said before, UK through accessing in the areas of the Single Market, is going to adopt EU legislation that is associated with these areas. Participants of EEA have the chance to join the expert games and committees in the initial periods of a legislative proposal even if by that, they cannot take part in elections on legislations in the European Council or European Parliament. Staying in the single market after Brexit would lead to the lowest increase in UK-EU trade costs.
In a ‘pessimistic’ scenario, which is also called as ‘Hard’, every household will have a noticeable drop in income around 2.6% which is approximately £1,700. But the most important part is that, trade will lose its income per capita more than any other savings that the UK government gains from the decrease fiscal contributions to the EU budget. UK through exiting without agreeing any new deal with EU, will have to face the ‘consequence’ that all its trade with the EU will be under WTO terms and policies. Each member of WTO has to allocate exactly the same most favored nation (MFN) market access, for instance, charging the same tariffs to the other World Trade Organization members. If UK conclude to become a WTO member, most probably would no longer have the freedom to tariff-free trade in goods with the EU. In contrast with the FTA agreements, UK as a member of WTO would not have the authority to be bound of the four freedoms. Also, the condition with poorly quantified migrants inside the EU could terminate. However, as opposed to the FTA, no corresponding relaxation will appear in immigration agreements for highly qualified migrants. As a WTO participant, exporting from UK to the EU and to other WTO participants would be an issue to the importing countries’ MFN tariffs. In order to enter to the WTO membership, UK needs to accept the fact that WTO terms are not permitting free movement of labor so the UK will no longer have the ability to labor freely with EU. No deal Brexit means that politicians could not achieve to agree with EU before leaving. Otherwise, the country will walk away with no deal.
Employment will be affected too and the markdown of economic output is clear. Firstly, the short-term effects will fast appear by the fall of available jobs between 1.7% and 2.9% according to hypothesis in 2020. That, will eventually slightly recovering in the long-term. The number of people employed will also reduce by around 3500000 and around 600000 in approximately 10 years’ time (2030) significant to the counterfactual in the FTA and WTO scenarios (Dhingra, 2016). Another issue that has recently assumed increasing prominence is the labor mobility. EU origin workers play a key role in the UK labor market that is now representing over 5% of use.
In both scenarios, the UK unemployment rate is expected to rise peaking in 2020 at around 7% in the FTA scenario and around 8% in the WTO scenario. In the 2020s, unemployment gradually falls back in both scenarios as unemployment has returned to broadly the same level as in the counterfactual scenario (5%). The past decade the size of the British workforce was nearly 2 million people according to Richard Partington (2018), rather than only 820000 people that are going to get a job. That means to a very obvious slowdown in the workforce after UK leave the EU.
After many researches has been made about how migration will change after Brexit, analysts end up thinking that migration will be reduced in the UK. According to the FTA, migration in UK would face a difference between only -0.8% and -1.0% (Jonathan et Al., 2016). On the other hand, under WTO terms, UK migrants will face a slightly increase migration with -1.3% by 2020 and until 2030. The introduction of tighter restrictions on migration is estimated to reduce UK GDP by around 1-1.6% of GDP in the two scenarios due to reduced labor supply.
In summary, it could be argued that by having the UK leaving the UK, equal positive and negative effects will appear. It is generally agreed that Soft Brexit is the least bad option for UK economy whilst Hard is named as the most catastrophic scenario. In my point of view, I think that if UK wants to improve its trade relationships between EU, has to take advantage of Soft Brexit agreements and follow that path that leads to the better UK future regarding not only the economy but also the living standards. Trade will also be treated exactly the same as before Brexit (Piet EECKHOUT, 2018).
References
BBC. (2019). Brexit: All you need to know about the UK leaving the EU. Available: https://www.bbc.co.uk/news/uk-politics-32810887 [17 November 2019].
Ciarán Burke, Ólafur Ísberg Hannesson, Kristin Bangsund. (2016). ‘Life on the Edge: EFTA and the EEA as a Future for the UK in Europe’ . Available: https://www.kluwerlawow6nline.com/abstract.php?area=Journals&id=EURO2016005 [13 November 2019].
Prof. Piet EECKHOUT. (2018). Future trade relations between the EU and the UK: options after Brexit. Available: http://www.europarl.europa.eu/RegData/etudes/STUD/2018/603866/EXPO_STU(2018)603866_EN.pdf [28 November 2019].
Richard Partington. (2018). UK businesses told to expect workforce crisis after Brexit. Available: https://www.theguardian.com/global/2018/mar/29/uk-businesses-workforce-crisis-brexit-young-workers [13 November 2019].
Swati Dhingra, Gianmarco Ottaviano, Thomas Sampson, John Van Reenen. (2016). The consequences of Brexit for UK trade and living standards. Available: http://personal.lse.ac.uk/sampsont/TradeLivingStandards.pdf [13 November 2019].
Technology has become an important part of human life. In the modern era, technology influences the lifestyles of people as well as their opinions. Although technology has many benefits, it also provides an avenue through which people can circumvent rules and regulations. Brexit offers a clear example of how people can manipulate technology to defeat regulations. During the Brexit referendum campaigns, Facebook played a big role in influencing voters. The outcome of the Brexit vote was a result of concerted efforts to influence voters’ opinions using target ads. The misuse of Facebook to influence the Brexit vote justifies the need to control the use of technology to ensure adherence to rules and regulations in all processes.
During the lead up to the Brexit vote, the Vote Leave Campaign team worked hard to push certain narratives that would tip the vote in their favor. They were able to do this by using the services of Cambridge Analytica, which illicitly collected information about voters from Facebook (Scott 2018). They then used the information to target the voters with ads that appealed to their fears. For instance, through political profiling, Analytica was able to know who to send ads about immigrants. As a result, people in a country like Wales, with minimal issues about immigration developed unnecessary concerns and opted to vote for Brexit.
The reactions by Facebook indicates that the Facebook management was aware of the activities of Cambridge Analytica. The company refused to cooperate when asked to provide answers to the issues surrounding Cambridge Analytica’s activities. Facebook further threatened to sue to stop the publication of the article detailing the malpractices of Cambridge Analytica on Facebook (Cadwalladr 2019). The conduct of Mark Zuckerberg further shows that there was knowledge of what was happening. Zuckerberg refused to appear before the UK parliament to answer questions surrounding Facebook’s role in Brexit. The lack of cooperation from Facebook is an indication of their Knowledge of what Cambridge Analytica was doing.
The statements during the Brexit campaign suggest that the UK may not have been fully in the EU. Slogans such as “Taking Back Control” suggest that some people in the UK did not feel as part of the EU (Cadwalladr 2019). They felt that they were not benefitting from the EU and should therefore exit and be on their own. Such sentiments fueled the campaign to exit the EU. That is despite the efforts of the EU to develop the UK through funding of various projects. Brexit would therefore have a huge impact on the ordinary people in the UK as it affects them directly. Most people only voted based on the ads that were coming through their newsfeed on Facebook. However, they failed to consider what the EU had done for them, which was very evident based on the different projects funded by the EU across UK. Brexit means the reduced EU funding for such projects in the future.
There is no justification for the fear of turkey immigrants flooding Europe. Although the referendum took place when there was increased immigration across Europe, the Vote Leave Campaign took advantage of that to spread unnecessary fear. For instance, Wales had no cases of Turkish immigrants yet the people said they were fed up with immigrants and refugees (Cadwalladr 2019). The Facebook ads created a notion about refugees and immigrants, and rode the narrative to spread fear and push for a vote to exit.
Facebook played a key role in the Brexit vote. Through targeted Facebook ads, the Vote Leave campaign team was able to convince voters to vote for Brexit by taking advantage of their fears. The misuse of Facebook during the Brexit campaign shows the potential risk of misusing technology to defeat free and fair processes.
The relationship between the United Kingdom and the European Union is crucial to the tourism business across the country. There are many implications that Brexit will have for a variety of UK-based companies, and a lot more are unknown due to the uncertainty surrounding the post-Brexit legislation (Miller 2016). The effect of Brexit on the tourism industry is controversial, as it will provide both opportunities and challenges to businesses operating in this sector. In the present report, I aim to focus on the impact that Brexit will likely have on hotel business overall and its operations. It will show how, despite the overall growth of the tourism industry due to Brexit, hotels may struggle to survive due to severe employee shortages and foreign workers’ taxes. Overall, the report strongly indicates the need for governments to address the issue of foreign workers in certain industry areas that rely heavily on EU employees.
Growth of Tourism
The general state of the tourism industry in the country is crucial to the success of hotel businesses as they are the main providers of stay for visitors. The UK is already experiencing an increase in tourism due to the fall in the pound, which was caused by the results of the Brexit referendum (Cox 2017). For instance, Allen (2017) writes that Official reports showed there were 37.3m visitors to the UK in 2016, which is 3% higher than the previous year and the highest number in the historical records. The industry anticipates further growth as the flight booking numbers at the beginning of 2017 were up by 13% comparing to the previous year (Allen 2017). The government is also focused on supporting the growth in tourism as part of its post-Brexit development plan. For example, the government intends to facilitate cross-country travel, introduce more flexibility to tourism employees training programs, and enhance the B&B regulations to allow for better customer service (Rhodes & Ward 2017)ю
Supporting agriculture, which may be impacted by the change in funding schemes, is also part of the post-Brexit plan (Potton et al. 2017). The success of the agricultural sector is essential as most hotel chains rely on local suppliers for food and drink resources. Despite the number of opportunities discussed above, there are also some potential problems that may affect the hotel industry. For instance, some anticipate challenges to transportation development due to Brexit, such as an increase in flight fares and the halt of the HS2 speed rail line (Butcher 2016). It is also unclear as to what will happen to the agricultural funding after 2020 (Potton et al. 2017). All in all, the tourism industry is likely to grow in general, resulting in an increased demand for hotels. However, the problems in transportation and agriculture may limit the overall positive development and provide operational challenges to hotels, such as looking for new suppliers.
Challenges to Operations
Most of the operations performed in hotel businesses before Brexit were governed by the EU regulations. This facilitated cooperation between the UK hotels and entities from other EU states and made it easier to recruit EU staff and transfer workers across the hotel chains to different countries. Currently, the vast part of employees in the UK service sectors is from EU countries or other parts of the world (O’Carroll 2017). Under the new regulation proposed by the government, the current foreign workers’ regulation will extend to employees from the EU, and the businesses will have to pay a yearly fee of £1000 per employee from overseas (Merrick 2017). This fee will be applied on top of the existing visa charges and the resident labor market test (Merrick 2017).
Moreover, the restrictions on the employee visa schemes may cause many workers to leave the country; given the shortage of British workers in the hospitality jobs market, it will take years to replace EU staff in large chains (O’Carroll 2017). Another difficulty in hotel operations may be created by the change of data protection requirements. The EU businesses adhere to the GDPR standards of data protection; however, after the Brexit, the UK government may decide to change the current scheme (Ward 2016). Differences in data protection requirements between the UK and the EU will put extra pressure on international hotel chains, which will no longer be able to transfer information across the borders. Perhaps, the only opportunity that these changes will offer is increased stability of the workforce, as British people are likely to stay in the country and on the job for longer. Overall, if these difficulties are not addressed in a proper way, they may pose a threat to hotel businesses across the country, making it harder for them to operate in a competitive environment.
Conclusion
All in all, Brexit will create opportunities for the tourism sector to grow, as the visitor demand is likely to increase further. The government schemes provide sufficient support to certain areas of the business that hotels rely on, which will decrease the number of threats associated with Brexit. However, the government will also need to address the issues regarding employees, transportation, and data protection, as the current outlook for the policies regarding these topics is hardly promising.
Potton, E, Grimwood, GG, Booth, L, & Sutherland, N 2017, ‘Effect of the UK leaving the EU on the rural economy’, House of Commons Library Debate Pack, no. CDP 2017/0018, pp. 1-36.
Rhodes, C & Ward M 2016, ‘Potential effect of the UK leaving the EU on UK tourism’, House of Commons Library Debate Pack, no. CDP 2016/0169, pp. 1-9.
Ward, P 2016, ‘Brexit and data protection’, House of Commons Library Briefing Papers, no. 7838, pp. 1-14.
The article “Data regulation: Britain faces data privacy confusion after Brexit” studies the implications of the United Kingdom’s decision to leave the European Union on data protection and the difficult decisions the government will have to make in the face of these changes.
Within the European Union block, personal data can travel freely between countries. The article postulated that if Britain exited the Union, its digital space companies would have to readjust to adapt to new conditions, where they will have to face the same criteria and limitations as the other non-EU institutions.
This forces the government officials to urgently consider how they are going to restructure their data protection laws to interface with the EU and its regulations.
The country has two options. The first is to accept the latter’s rules on general data protection. While the rules were designed to be pro-business in nature, they impose some of the same “red-tape” and overbearing regulations that Britain hoped to avoid through Brexit. For example, there would be a universal obligation to hire a data protection officer, regardless of the size of the company.
The second option is to develop their set of regulations. Besides being a time and money consuming process, it creates the risk of these regulations not being accepted by the EU regulators, leading to the risk of isolation and hefty expenses for the British corporations.
Due to the projected opposition of the US to Britain’s own rules, the possibility of the country integrating the EU regulations increases.
Author’s Position
The author of the article creates a sense of objectiveness by not actively taking any side of the argument. However, it can be deduced that he is more supportive of the idea of Britain’s own data protection regime. This can be seen in his use of arguments. When describing the option of accepting EU’s regulations, Robinson gives a brief overview of how this decision can be harmful to the British business and why. On the other hand, when addressing the issues with the second option, he discusses the external issues and how other countries might impede Britain in accepting their own rules. He does not discuss the possible negative consequences of this option for the local business.
Relate to Class Material
This week’s class material discussed big data and data aggregation. These two concepts play a very important role in the management and strategy building of businesses and are very important for accurate SWOT and Porter’s five forces analyses.
The situation described in the article threatens to make it more complicated for corporations to aggregate and analyze big data. They will have to readjust their policies and strategies to accommodate new regulations, which will probably limit how and to what extent they can collect.
Since big data aggregation is one of the key parts of the marketing research and demand analysis, the companies will be forced to increase their expenses to meet the new regulations and criteria.
In case Britain will decide in favor of a “no-deal Brexit,” which includes the termination of the free trade agreement with the EU, it can
make all importers’ and exporters’ trade operations more costly and, thus the prices for European products in Britain and British goods in EU states will rise;
lead to stricter border control of all imports and increase the risk of food shortages in Britain due to delays;
result in conflicts between Northern Ireland (a UK part) and Ireland (an EU member) due to a plan to establish a custom border between the two (Amadeo 2019).
Brexit’s Effects on MENA
Brexit can seriously affect the way international businesses operate in Britain, including those based in the Middle East. Some of the sectors and industries that might be impacted most are real estate, banking, trade, and travel (Dudley 2016). For instance, as part of the EU, UK is currently in the Free Skies agreement with Gulf Airlines, one of the largest airline companies in the Middle East (Dudley 2016). After Brexit, airway deals, similarly to many other trade deals between the UK and the countries of the Gulf region, will become more costly and the commercial processes will turn more complicated.
Roles of Political Parties
The Conservative Party supports Brexit but plans to negotiate and develop a new free-trade deal after quitting the EU market (BBC 2017).
The Brexit Party is for the “no-deal Brexit” and insists on withdrawing from the EU as quickly as possible (BBC 2019).
The Labour Party is against Brexit considering that it may negatively affect the economy and workers (BBC 2019).
The Liberal Democrat Party is strongly against Brexit and advocates for preserving EU membership (BBC 2019).
The Scottish National Party is pro-EU and, thus, wants Scotland to receive a special status after Britain’s withdrawal (BBC 2017).
The Green Party opposes the “no-deal Brexit” and favors further negotiations (BBC 2017).
The Democratic Unionist Party is for a softer form of Brexit and the development of positive relationships with the EU (BBC 2017).
The UK Independence Party is for Brexit since it wants the country to abide by its laws (BBC 2019).
Plaid Cymru and the Independent Group for Change are pro-EU and pro-negotiation but will accept the results of the vote (BBC 2019).
The stances of Northern Ireland Parties on Brexit vary, but the majority is pro-EU and for further negotiations (BBC 2019).
UK Parliament’s Objectives and Roles
Due to a significant divide between different parties’ perspectives, the main objective of the UK parliament regarding Brexit is the continuation of the deal negotiation. Further discussions will continue until October 31, 2019 – a set date for Britain’s withdrawal from the EU (Shakhnazarova 2019). Nevertheless, the UK government can be currently inclined towards the withdrawal considering the views of the leading party. The Conservatives hold the majority of seats in the parliament – 310 (NewStatesman 2019). Moreover, the party’s present leader and the UK Prime Minister, Boris Johnson, is well-known for his strong support of the no-deal Brexit.
The distributions of other political parties in the UK parliament is now as follows:
The Labor Party – 245,
The Scottish National Party – 35,
The Liberal Democrat Party – 13,
The Democratic Unionist Party – 10,
Sinn Fein – 7,
The Independent Group for Change – 5,
Plaid Cymru – 4,
The Green Party – 1,
Independent members of the UK House of Commons – 16 (NewStatesman 2019).
It is clear that the opposition slightly falls behind the Conservative Party in terms of its parliamentary presence, and has a total number of 319 at the present moment (NewStatesman 2019). Nevertheless, it is worth noting that the results of the European election that took place in May were controversial. While the Brexit Party received the highest number of votes among all parties, the collective percentage of pro-EU parties included in the parliament was higher (Sabbagh 2019). This shows that many UK citizens still prefer to be included in the EU, and their attitudes may play a role in the final decision on Brexit.
Effective Political Parties and Leadership Overview
The most effective parties are those with the largest number of seats in the parliament and with the biggest membership rate. They include the Conservative Party, the Labor Party, and the Scottish National Party. As it was previously mentioned, the first one on the list is headed by Boris Johnson, a former Foreign Affairs Minister and mayor of London (Kirby 2019). The party has approximately 180,000 members, and its main members are the UK government’s numerous secretaries, including Mitchel Gove, Sajid Javid, Dominic Raab, and others (Membership 2019).
As for the Labor Party, it is led by Jeremy Corbyn and has the largest member population among all UK parties, which equates to 512,000 individuals (Membership 2019). Some of its prominent members are “Laura Parker, a leading figure in the Momentum campaign group, and Eloise Todd, chief executive of the Best for Britain group” (BBC 2019, para. 5). Lastly, the Scottish National Party comprises 125,500 members and is headed by Nicola Ferguson Sturgeon who also serves as the First Minister of Scotland (BBC 2019). A few of its stand-out members include Alyn Smith, Aileen McLeod, Margaret Ferrier, Christian Allard, Heather Anderson, and Alex Kerr.
Election
The UK general election happens every five years as per the Fixed-term Parliaments Act 2011 (General elections n.d.). The last election took place in the country on 8 June 2017 (General elections n.d.). It means that the next one will be in 2022. However, the government may sometimes call for a snap election or, in other words, an election that is administered earlier than normally scheduled. According to Adu (2019), there is a chance that Boris Johnson may utilize this tactic to resolve the Brexit issue and change the distribution of pro-withdrawal votes in the parliament in his favor. Still, it is important to note that the outcomes of such a move can be unexpected since the number of pro-EU seats may increase as a result of the vote as well.
UK Government
All UK secretaries come from the leading party and include
Prime Minister, First Lord of the Treasury, and Minister for the Civil Service – Boris Johnson,
Chancellor of the Duchy of Lancaster – Mitchel Gove,
Chancellor of the Exchequer – Sajid Javid,
Foreign Secretary and First Secretary of State – Dominic Raab,
Home Secretary – Priti Patel,
Secretary of State for Exiting the European Union – Stephen Barclay,
Secretary of State for Defence – Ben Wallace,
Lord Chancellor and Secretary of State for Justice – Robert Buckland,
Secretary of State for Health and Social Care – Matt Hancock,
Secretary of State for Business, Energy and Industrial Strategy – Andrea Leadsom,
Secretary of State for Housing, Communities, and Local Government – Robert Jenrick,
Secretary of State for International Trade and President of the Board of Trade – Elizabeth Truss,
Secretary of State for Education – Gavin Williamson,
Secretary of State for Environment, Food and Rural Affairs – Theresa Villiers,
Secretary of State for Transport – Grant Shapps,
Secretary of State for Work and Pensions – Amber Rudd,
Leader of the House of Lords and Lord Privy Seal – the Baroness Evans of Bowes Park,
Secretary of State for Scotland – Alister Jack,
Secretary of State for Wales – Alun Cairns,
Secretary of State for Northern Ireland – Julian Smith,
Secretary of State for International Development – Alok Sharma,
Secretary of State for Digital, Culture, Media, and Sport – Nicky Morgan,
Minister without Portfolio (Cabinet Office) – James Cleverly (Her Majesty’s Government n.d.).
The withdrawal of the UK from the European Union, known as Brexit or the Leave, has been the point of much debate, in particular, because of the multitude of supporting arguments on both sides. The supporters have named such reasons as uncontrolled immigration rates adversely affecting the job market, housing, and education, while the opponents mostly pointed to the benefits of international partnership. The reasons most often named as responsible for the ultimate outcome of the referendum are of political, economic, and social character, although some experts also point to the psychological underpinnings.
Literature Review
Since the voting has confirmed the determination of the majority to leave, several experts have offered different explanations regarding the reasons for such overwhelming dissatisfaction. Most of them name the poor economic and financial performance and the uncontrollable rate of the immigration, while other quote the poor political decisions by the EU officials which introduce uncertainty into the British political affairs. For instance, Field Marshal Charles Guthrie names the questionable military operations run by the European Union as undermining the integrity of its members’ defensive capabilities (Brexit, 2016). Guthrie also voices concerns regarding the complexity of government composed of 28 countries with different agendas, which disrupts the ability of quick action, and the absence of clear leadership and unified goals (Brexit, 2016). Tony Abbott, a former prime minister of Australia, noted that since Britain has the world’s fifth largest economy, there is no reason to comply with the external standards, and that Britain would benefit from free trade agreements more than from the current setup, where Britain is forced to contribute to the Union’s budget, which currently leaves it with a net loss of £8.5 billion (Brexit, 2016).
In fact, some experts, including Noel Malcolm, a senior research fellow of All Souls College, Oxford, suggest that leaving European Union will benefit both sides, as the system is currently dysfunctional to the point where it disrupts the possible economic benefits, and that once Britain is allowed to handle its affairs independently the overall climate and international relations will improve (Brexit, 2016). An article published in Independent suggests underlying psychological implications for the unanimity. At least some of the decisions were driven by the opposition to social change that is currently happening across Europe. The poll conducted by the Tory peer Lord Ashcroft shows a clear tendency of voters supporting the Leave to be hostile towards feminism, multiculturalism, and social liberalism, among others (Chu, 2016). For these people, Brexit is essentially the way of expressing their disagreement with the current tendencies, which they strongly associate with their own low level of wealth. There is also evidence that suggests some connection between the desire to leave and economic deprivation (Chu, 2016), which is logical once we assume the change to the better but becomes dubious in case there is no direct and clear relation between the two.
Background
To properly determine the reasons for the Leave, a concise review of the implications is required. The majority of the most popular given reasons can be categorized as either economic, social, or political.
Economic Issues
Cheap labor
One of the most often cited reasons for leaving EU is the current situation on the job market. The current statistics show a sharp increase in the EU workers being employed in Britain, rising from 1.4 million in 2013 to 2.1 million in 2016. The EU workforce now comprises 6.8 percent of the total working population, compared to 2.6% registered in 2006 (Travis, 2016).
This situation is attributed chiefly to the fact that being a member of the European Union requires a milder immigration policy which presumably allows the immigrants from less economically stable regions of Southern and Eastern Europe to apply for the more financially appealing positions. Such setting evidently limits the possibilities for the native British to find a job. Furthermore, the immigrants from the less economically strong regions are likely to be satisfied with a lower salary. This allows the employers to lower the wages and actually prefer cheaper workforce, creating the overall downward trend in wages and benefits and putting the British citizens at a disadvantage. Finally, the absence of the upper limit of the immigration compromises the predictability of the job market, introducing uncertainty and compromising stability.
Education
The gradually rising immigration rates are also named as a primary reason for the shortage of places in the public schools. An independent non-political organization Migration Watch UK has estimated that since the migration has taken serious pace in the late nineties, the additional funding allocated solely for the children of immigrants was more than £16 billion, with the cost steadily progressing each year (Migration Watch UK, 2015).
In addition, the projected rates suggest the continuation of the trend, further complicated by the expected birth rates from the immigrating population. As most of the immigrants are of working age and rarely come to Britain with children, the “direct” impact of immigration is relatively negligible, so most of the projected increase comes as an “indirect” impact. Despite the government constantly building new facilities to accommodate the new students, it is likely that the rates of new school places’ surplus can not cope with the projected number, and by 2019 at least three-fifths of the local authorities will likely have insufficient primary schools to provide education for all children. Currently, 93 percent of the British population receives education through public schools, and, since there is no reason to expect a different distribution among the immigrant population, the effect may seriously undermine the educational system.
Social Issues
Homelessness
There are also concerns regarding the rise of homelessness rates connected to the membership in the EU. The initial assumption is that the immigrants fail to find the place to live, resulting in more people in the streets. Additionally, social programs aimed at addressing the issue require funding, which rises with the growing immigration rates. However, upon closer inspection, neither of the claims is directly related to homelessness rates. Thus, the homelessness issue is most likely triggered by the underlying psychological issues rather than the actual social phenomenon.
Health issues
One of the central arguments for leaving EU was the possibility to allocate the resources which are paid to the EU (about £8 billion yearly) to National Health Service (NHS), which is currently seriously underfunded. However, the situation is likely more complex than portrayed by the Brexit proponents. First, there is no guarantee that all, or even any of the saved resources will be allocated to healthcare. Second, the EU membership is at least partially beneficial for the NHS – for instance, the shortages of medical and nursing personnel is currently dealt with by recruiting foreign workforce.
Political Issues
Housing
Some people believe that immigration is also resulting in shortages of housing for the native population. While the uncontrolled rate of population growth will inevitably lead to the housing issues, the problem is two-sided. The housing market is gradually rising after the referendum. This means a more stable income for those in business, but also a more expensive cost of living for the British. In a way, housing prices were changing on the same principles as wages discussed above, so currently there is no clear answer if the Leave was ultimately good for the native population.
Racism
One of the most bitter and hotly debated topics connected to the Leave is the growing anxiety resulting from immigrants from other countries. Some suggest that the direction taken by the EU towards multiculturalism creates unnecessary tensions, and some go as far as state that racism is caused by the influx of people from other countries. Others suggest that racism is a cause rather than the result, and the exposure will gradually alleviate the issue. While there is no conclusive evidence to either of points, the immigration seems to be the cause of at least some of the anxiety in the UK (Chu, 2016).
Smugglers
The relaxed visa policy of EU has also led to the assertions that the immigrants are using it to smuggle goods in the UK. The belief is not unfounded, as the possibilities for smuggling are increasing from the statistical perspective and the customs personnel deals with gradually increasing amount of work.
Methodology
The research was done in the form of literature review. The information was gathered using the reputable and reliable online sources. The preference was given to the British periodicals such as the Guardian, The Independent, and The Spectator. The statistical data was retrieved from the independent non-political organizations such as Migration Watch UK.
Results
The predictions of the effects of Brexit are polarizing. As almost all of the discussed issues have two sides to them, there is no conclusive evidence that the changes will be immediate and beneficial for all of the population, as portrayed by its proponents. At the same time, at least some of the issues, such as the shortages in public education, will likely see improvement in the nearest years. Unfortunately, at least some of the problems attributed to EU membership are either the aftermath of the financial crisis or, in some cases, the shortcomings of the British government, so the change, even in 20 years, will not likely be as overwhelmingly positive as people believe. For instance, the job market may gain stability, but lose in flexibility, so the actual benefit for native population is uncertain and may come unnoticed for most of the British. The NHS will likely receive additional funding, but may result in understaffing, as well as complicate the international healthcare threats, such as pandemics. Finally, the social anxiety will likely be relieved in the short term (probably within a year), but may backlash for the immigrants who will stay in Britain, as racism is highly unlikely to disappear once the borders are more strictly controlled.
Conclusion
The Leave is a hotly debated topic for a reason. It involves a multitude of interconnected factors. Some of them are appealing to the public, such as the control over the immigration and improvements in wages. Others are more complicated and do not evidently result in benefits for the majority of the population, for which reason they are usually overlooked or downplayed. Nevertheless, such factors also count in as significant for country’s well-being. Both groups of factors will inevitably be affected by the Leave, but the net outcome is uncertain. Some areas, such as public education, will likely see change for the better, while others, such as medicine, will face additional challenges. It is certain, however, that the economic, social, and political sectors will have to deal with the changes, not all of which will be favorable and most of which will strongly impact the performance. This effectively means that while in the long run, the Leave may be ultimately good for Great Britain, the initial stage will most certainly be disappointing for many of its supporters.