If you thought that the budget was bad? Why not post your take on it, up on the Politics thread?
The report, as I stated, is from November 2025…so not old news at all. It is looking at the real world effects of Brexit on the UK today. Not looking at predictions from years ago.
Personally I found the graphics at the end of the report very useful.
But maybe the summary page 32 is enough?
6 CONCLUSION
This paper presents a comprehensive economic analysis of the UK’s decision to leave the European
Union. We employ both macro and micro approaches to evaluate the implications for GDP,
investment, employment, and productivity. Our macro analysis is based on comparing the UK’s
economic performance against a set of comparable countries, using a range of different weighting
methods to estimate what the UK economy might have looked like without Brexit. Our micro
approach employs a difference-in-differences estimation using firm-level data from the Decision
Maker Panel survey, matched with firm accounts. The micro approach is likely to better capture
the causal impact of Brexit, but it may miss the impact of general equilibrium spillovers.
We estimate that by the start of 2025, the UK economy was approximately 8% smaller than it
would have been without Brexit, based on macro data, and 6% smaller using firm-level micro data.
Investment is estimated to have been 12-18% lower, employment 3-4% lower and productivity
also 3-4% lower than it would have been if the UK had not voted to the leave the EU.
We show that Brexit generated a large, broad and long-lasting increase in uncertainty. This
contributed to lower business investment, in particular, but it also may have reduced productivity
too by restraining innovation and spending on potentially productivity enhancing forms of capital
expenditure. We also show how the time and resources firms devoted to preparing for Brexit were
strongly correlated with lower productivity. These channels have potentially been more important
than the effects of reduced trade with the EU, at least initially, although the ways in which Brexit
affects productivity will change over time and the trade effects may well become more important.
The UK’s experience of Brexit also has some parallels with the recent implementation of new
tariffs on goods entering the United States in 2025. There are few other examples of increases in
trade barriers between major developed countries, and like Brexit, announcements on tariffs have
created uncertainty about what future trading arrangements could be and what the process towards
a long-term solution might look like. In the case of Brexit, there was a substantial economic impact
on the United Kingdom.