The UK Economy, Brexit & Trump

This morning we enjoyed an insightful business breakfast hosted by the Chilworth Partnership & Venture Recruitment Partners at the Chilworth Manor Hotel and we heard from one of the UK’s leading economic commentators, Alex Brummer. Brummer has been City Idiot of the Daily Mail since 2000 and is a multi-award winning economic finance commentator. The topic was Brexit and the potential impacts on the British economy. To add spice to the event there was also the fresh topic of “Trumpenomics” to discuss after the much-publicised U.S election winner Donald Trump. Brummer is no fool and whilst he was pro-Brexit he empathised with the shock both events have caused.

Despite a lot of doom and gloom from his peers in the media, there was a clear sense of optimism in the talk from Brummer, describing the UK economy as “having taken the punches pretty well”. Indeed, in the 3rd quarter we have seen growth at 0.5% and likely to see annualised growth in the UK of around 2% – a faster rate than any of the Group of Seven (G7) countries. From a recruitment perspective, there is much to celebrate as the unemployment rate has dropped to 4.8% and the number of people in employment is at its highest in 30 years. Whilst the Chancellor’s Autumn statement next week will likely reveal a dampening of economic expectations, Brummer asserted that infrastructure investment in the 3 ‘Hs’ will boost the economy in time, notably Hinckley Point in Somerset, HS2 and the expansion of Heathrow.

Back to Trump in the U.S, Brummer argued that his pledge to reduce corporation tax from 37% and a massive increase in infrastructure spending will see the UK’s burgeoning Services sector well placed. In this respect, he asserted that the UK ‘punched well above its weight’, operating at a surplus of £100 bn a year. I think only time will tell just how this new political and economic relationship between Britain and the U.S will work.

One thing is for sure is that Brexit certainly hasn’t been an immediate disaster, reflected by the strong performances of the FTSE 100 and FTSE 250 since June. Brummer claimed a lot of this is down to businesses bringing their operations, and therefore more of their investment, back to Britain. Tangible example of businesses positive reaction to Brexit can be seen at Nissan, Ford and more recently Google, all making positive long term commitments to the UK. More businesses investing in Britain is surely a good thing for our employment? Brummer warned of the failings of Europe, describing the EU as an “Economic disaster” and the facts are scary; Greece’s GDP has dropped by 25%, Youth Unemployment in Italy is now at 37% and growth since Germany joined the EU is stagnant.

Brummer did not underestimate the UK’s adjustment to Brexit and nor should we, but perhaps we should try and look at the positives of the events that have happened in the past few months. There are challenges to come, like the possibility of a trade war, Trump going back on his economic policy and the Pound weakening a lot further. However, I, like many in the room, came out with some reasonable optimism to see this not as a problem but as an opportunity. To quote Brummers’s closing remark we should “see the glass as half full not half empty”.

 

 

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About the Author

martinsmith

Senior Manager and experienced procurement recruiter. Positive and results orientated with a passion for finding innovative solutions and delivering on every project. Specialises in placing senior Procurement Professionals across London and the Home Counties.

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