What are the economic impacts of Brexit on the UK’s sectors, regions and cities?

Published: Posted on

This piece was written by City-REDI’s Professor Raquel Ortega-Argilés.

Recent research suggests that the UK’s cities and regions which voted for Brexit are also the most economically dependent on EU markets for their prosperity and viability (Los, McCann, Springford and Thissen, 2017). This is a result of their differing sectoral and trade composition. Different impacts are likely for different sectors, and also different impacts are likely between sectors, and these relationships also differ across the country’s regions. Some sectors, some regions and some cities will be more sensitive and susceptible to any changes in UK-EU trade relations which may arise from Brexit than others and their long-run competitiveness positions will be less robust and more vulnerable than others. This suggests that these sectoral and regional differences need to be very carefully taken into account in the context of the national UK-EU negotiations in order for the post-Brexit agreements to be politically, socially as well as economically sustainable across the country.

Our ESRC- Brexit priority grant: “What are the economic impacts of Brexit on the UK, its sectors, its cities and its regions” under the UK in a Changing Europe initiative aims to examine in detail the likely impacts of Brexit on the UK’s sectors, regions and cities by using the most detailed regional-national-international trade and competition datasets currently available anywhere in the world. The quantitative research will allow us to understand the role in shaping UK regional trade behaviour which is played by global value-chains, whereby goods and services crisscross borders multiple times before being finally consumed by household and firms. Our data allows us to examine the impacts of different trade scenarios and to map out the sensitivity of UK sectors and regions to different post-Brexit scenarios.

At the same time, these changes will also have profound implications for the design and governance of UK city and regional development policy logic and settings. The ongoing UK devolution agenda will be heavily affected by the changing external environment and our project will also identify the governance, policy and institutional options which key stakeholders perceive to offer the greatest possibilities for adjusting to the new realities. Participatory workshops with city, regional and national stakeholders will be organised in order to develop alternative post-Brexit scenarios for empirical analysis as perceived by the city and regional as well as national institutions. The mix of quantitative and qualitative approaches will allow us to identify the impacts of Brexit at the crucial meso-levels of the individual sectors, the individual cities and the individual regions.

The core project research consortium is composed by Prof. Raquel Ortega-Argilés (University of Birmingham), Prof. Philip McCann (University of Sheffield), Prof. Bart Los (University of Groningen), Dr Mark Thissen (PBL Netherlands Environmental Assessment Agency) and Prof. Frank van Oort (Erasmus University Rotterdam and University of Utrecht). The project is supported by Center for Cities, ResPublica, Policy Scotland, IPPR North and the Local Growth Analysis team at the Department for Business, Energy and Industrial Strategy (BEIS).

For additional information about the project, please visit: “What are the economic impacts of Brexit on the UK, its sectors, its cities and its regions”

Image from Max Pixel / CC BY

Leave a Reply

Your email address will not be published.