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Brexit impact: companies consider moving overseas and slashing jobs

Two major banks have already begun shifting operations out of the UK if rumours are to be believed

The impact of a Brexit vote continues to be felt, with business leaders suggesting that they may be preparing to move operations abroad and slash jobs in the UK. According to an Institute of Directors survey, 64 per cent of business leaders said that a vote to leave the EU would have a negative impact on business.

Foreign Secretary Philip Hammond was quoted as saying that investment in the UK had all but dried up and it would be catastrophic if the UK were to lose access to the single market. He added that for 40 years the UK has developed stability directly tied to this market and that the economy could suffer as a result of a vote to leave.

Foreign investment a strong influence

Hammond also cited the flow of direct foreign investment as a driving force in keeping the UK’s economy healthy and added that jobs and prosperity can be attributed to access to the single market, underlining his warning that Brexit is bad for business. Business Secretary Sajid Javid has also been in action after the EU Referendum, announcing that he will be in talks with international business leaders to convince them to keep trading in the UK; however, he tried to offer reassurance that the UK can avoid a lot of the negative forecasts if it works together.

Business anxiety is natural

Another poll conducted by the Institute of Directors found that 24 per cent of the respondents would be likely to plan a freeze on recruitment, while 22% could consider moving operations abroad. Simon Walker of the Institute of Directors admitted that many members were feeling the strain and were understandably anxious after the Brexit result. He said that the majority of business leaders felt that a Brexit vote would be bad for them; therefore, it is a natural reaction to be scaling back operations involving recruitment and investment.

In addition to business implications, the BBC has reported that major bank HSBC is planning to move around 1,000 staff to Paris if the UK leaves the single market. According to Deutsche Bank chief executive John Cryan, London’s stature as a leading financial sector is under threat post-Brexit. He added that while it won’t die, it will get weaker.

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