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Hard or soft, Brexit is going to hit us all in Scotland

  • Date: Monday 10th October 2016
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Almost four months have passed since the Brexit bombshell hit — and we’re still feeling the blast.

While we’re in the throes of deciding exactly what’s going to happen, it’s been interesting to see all the opinions, predictions and reports emerge on what the future holds — especially for Scotland.

An economic analysis carried out by the Fraser of Allander Institute at the University of Strathclyde has provided us with some explosive findings but has tempered them with some constructive hopes.

The report reveals that if Theresa May and the UK Government opts for a “hard” Brexit — one without any free movement in the EU and with no access to the single market — between 30,000 and 80,000 jobs will be lost in Scotland within a decade.

Those 80,000 jobs will make a significant dent in Scotland’s 5.295million population and will have a massive impact on individuals and families.

There’s no detail on which sectors will be affected but businesses across the country will no doubt be hunkering down, fearing the worst. The academics involved have also calculated that the Pound will be between two and five per cent lower after a decade outwith the EU that it would be if there was a Remain vote, shrinking the economy by £8billion.

And predictions show that real wages will fall seven per cent — a drop of around £2,000 per year for someone on average full-time earnings.

But it’s not all bad. The findings also show that as Scotland voted to stay in the EU, the Brexit effects may be “cushioned” and Scotland will perhaps not be as badly affected as the rest of the UK.

Experts explain that the UK economy (without Scotland) has greater exposure to UK trade than Scotland’s, so Scotland will see less of a negative impact when deals are not able to be struck in the same way.

The report also puts forward that, as Scotland voted to stay in the EU, people who want to remain part of it may choose to move to Scotland from other parts of the UK, which will give the Scottish economy a boost.

Whatever the outcome, it would be fair to say that a looser relationship with the EU could have a negative impact on a range of business sectors.

Before the vote, industry commentators gave their views on what would happen to businesses across sectors including science and technology, farming, food and drink, and health if Britain voted to leave.

Science and technology relies on a lot of EU business but there are many bright young entrepreneurs out there in Scotland fending for themselves. It’s going to be so important to invest in this sector as we move forward: It’s changing from second to second and I reckon we have the talent here in Scotland to lead the way.

Around 40 per cent of the total EU budget is dedicated to agriculture and Scottish farmers get support from the EU. Some industry commentators reckon that a drop in EU funding will prompt a restructuring of operations, others say that EU regulations make things more difficult for the farming community. Food and drink industry insiders have already said they reckon they can weather the storm — but we’ll see what happens if restrictions in the single market come into force.

And from a health perspective, anti-Brexit campaigners argue the EU helps in the sharing of expertise across borders. Just a few weeks ago, the Scottish Council for Charity Organisations said leaving the EU would be a risk for the third sector, and would affect the survival and well-being of vulnerable clients.

With so many different studies and opinions out there, it’s difficult to keep track. One thing is very clear — the Brexit decision has certainly made conditions very volatile.

To prepare for the Brexit decision being realised and rolled out, it’s so important that we continue to invest in businesses across a variety of different sectors in Scotland. We should be doing all we can at this stage to preserve these jobs and to keep our businesses healthy in the face of the groundbreaking changes that lie ahead.

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Related Content: Brexit Exit Planning

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