Brexit Cuts U.K Productivity and Spending, Bank of England Says
Brexit Cuts U.K Productivity and Spending, Bank of England Says
(Bloomberg) --
The U.K.’s planned departure from the European Union has cut the nation’s productivity by between 2% and 5% since the 2016 referendum, according to a report published by the Bank of England.
Senior managers at British companies are spending several hours a week planning for Brexit, researchers including Nicholas Bloom said in a working paper published on the Bank of England website Friday. Investment has fallen by about 11% in the three years since the Brexit vote, the report said. The drop in spending has occurred later than forecast at the time of the vote, reflecting the “size and persistence of this uncertainty.”
The paper is based on a survey of 5,900 U.K. firms accounting for about 3.7 million employees, or about 14% of private sector jobs in the U.K., the authors said. The Bank of England, University of Nottingham and Stanford University collaborated on the research.
British lawmakers will reconvene in the House of Commons on Tuesday, with some politicians seeking to combat a no-deal Brexit before a month-long suspension kicks in.
To contact the reporter on this story: Lisa Pham in London at lpham14@bloomberg.net
To contact the editors responsible for this story: Beth Mellor at bmellor@bloomberg.net, ;Andrew Davis at abdavis@bloomberg.net, Rachel Graham, Michael Winfrey
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