'A red flag': Business confidence in the UK economy is dropping as Brexit approaches
Brexit Scarecrows depicting former British Prime Minister David Cameron (L) and Foreign Secretary Boris Johnson are displayed during the Scarecrow Festival in Heather, Britain July 31, 2016.REUTERS / Darren Staples
LONDON — UK employers are increasingly concerned about the economy as Brexit approaches, according to new research.
A survey of 601 employers by the Recruitment and Employment Confederation (REC) found 31% of employers now expect the economy to worsen, and 28% expect it to improve.
That means the net balance has turned negative, falling from +6% in July to -3% in the latest report.
REC chief executive Kevin Green said issues including access to labour, Brexit negotiations, and political uncertainty are "creating nervousness."
"The jobs market continues to do well despite growing uncertainty. However, this drop in employer confidence should raise a red flag," Green said.
"Businesses are continuing to hire to meet demand, but issues like access to labour, Brexit negotiations and political uncertainty are creating nervousness. Employers in the construction sector are especially concerned as they rely heavily on EU workers to meet the growing demand for housing and to support the government’s infrastructure plans."
"Businesses are continuing to hire to meet demand, but issues like access to labour, Brexit negotiations and political uncertainty are creating nervousness. Employers in the construction sector are especially concerned as they rely heavily on EU workers to meet the growing demand for housing and to support the government’s infrastructure plans."
The government has flip-flopped over a series of positions on Brexit in recent weeks, including Prime Minister Theresa May's own "red-line" on the role of European judges after Brexit, and Green called on the government to offer greater clarity on its Brexit plans.
He said: "The government must do more to create an environment where businesses have clarity. That means clearly laying out what Brexit plans look like and how employers can keep recruiting the people they need from the EU. The jobs market is in a good place but employers will only continue to hire and invest if they feel assured about the future."
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