It’s almost been two months since the shock result in the UK’s EU Referendum; the result where the UK voted to leave the EU.
It’s been a rocky couple of months, and, yesterday, the BBC reported on the impact to the UK economy so far. In summary:
* The Office for National Statistics says there is no obvious impact to inflation.
* The pensions fund deficit for Britain’s top 100 companies has widened sharply.
* The Uk government’s deficit has grown.
* This has, in turn, been offset by the fall in the price of sterling.
* Interest rates have been cut (to 0.25% – crazy).
* Retailer’s performance in July was up compared to last year (they think this has been helped by warm weather).
* UK’s tourism has seen a boost because of the weaker pound.
* The UK’s house price increase has slowed.
* The messages on construction are mixed – some are saying there is little impact and others making the point that output is shrinking fast.
* The jobs outlook is also mixed with indications of businesses hiring fewer people, some large employers announcing job cuts. But others are also creating new jobs.
It doesn’t sound as though the UK economy has fallen off a cliff, but it also doesn’t sound as though we’re in rude health either.
As for YellowDog and our customers, one of the most worrying thing we observed was a 20% decrease in people searching for terms relating to our business in July. This was a sharp decline and I’m very interested to see what the results for August look like.
Our customers have been telling us a few interesting things:
* Before the vote a number of projects were on hold, waiting for the result.
* After the vote, UK work dried up considerably.
* This was countered by a large increase in enquiries from clients in the US.
* There’s a big risk at the moment around productions that were looking to funding from the EU.
The other impact is reputational. I’ve always been very proud of how the UK felt as an outward looking country – contributing to and helping to shape international, creative, political, humanitarian and economic projects. When I’ve been talking to some of our European partners and customers, they have no doubt that the UK will continue to innovate, despite leaving the EU. I worry that we won’t have the influence that we have at the moment.
Either way, with every major change there’s an opportunity. And with the UK now looking more attractive to foreign investment, maybe everything will be okay.
Time will tell.