Tuesday, July 16

More than 700,000 job losses in case of no deal


 

 

More than 700,000 jobs would be at risk for EU companies exporting to Britain if the UK and Brussels fail to agree a trade deal this year, according to a leading German economic research institute.

In total, including companies outside the EU that export to the UK, there would be 1m potential job losses in a no-deal Brexit scenario, according to an unpublished report by the Halle Institute for Economic Research seen by the Financial Times.

The research backs up the findings of a London School of Economics report published last week, which said 40 per cent of agricultural and food products consumed by UK households were imported from the EU. The report, sponsored by Denmark’s Arla Foods, predicted this would fall 63 per cent in a no-deal Brexit.

Under a no-deal scenario a number of product lines including yoghurt, buttermilk, dairy spreads, milk and cream are likely to cease being imported into the UK from the EU, the LSE report said, predicting a 26.5 per cent average price increase for branded and speciality food products imported to the UK from the EU under a no-deal Brexit.

The research, updating an initial report from February 2019, is still being peer reviewed and is due to be published in the coming weeks.

The scale of the job losses estimated by the research underline how much is at stake for both sides in the negotiations between London and Brussels, which are showing few signs of progress with time running out to sign a trade deal.

While the UK left the EU at the end of January 2020, it remains in the bloc’s customs union and single market until the end of this year. Unless a trade deal is agreed, customs checks and tariffs are expected to be introduced on trade between the EU and the UK next year.