The outcome of the Brexit referendum has reduced the value of UK companies by 16%, according to a new analysis from the University of Bristol.
The Independent reports that the researchers reviewed stock market data for 297 UK firms and bookmakers’ Brexit odds during the referendum campaign to estimate the financial impact.
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They found that, in the immediate aftermath of the referendum, prices of companies in the bottom quarter of the internationalisation ranking dropped by 21% on average while those in the top quarter fell by eight per cent.
Dr Piotr Korczak, Reader in Finance at the School of Economics, Finance and Management at the University of Bristol, led the research. He explained that the referendum result started a period of unprecedented political uncertainty. “It is difficult for companies to plan, investment is put on hold, and consumers cut spending,” he said.
“Ultimately, the economy slows down while everyone waits to see what will happen. We would expect to see the same trends if there’s a no-deal Brexit. This prolonged uncertainty is likely to see the value of UK companies decrease even further.
“Most affected are likely to be financial firms and consumer-facing sectors operating mainly in the domestic market. Firms with international operations should be less affected.”
Research from October 2018 suggests that Brexit is also having a large impact on the ability of firms to retain talent. . An increasing number of candidates are planning to change roles before March 29 2019 – the date the UK is scheduled to leave the EU – according to research from Morgan McKinley.
The researchers found there has been a 26% increase in professionals seeking new jobs, month-on-month in October 2018, which suggests workers are aiming to swap jobs before the March deadline.
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“Businesses are holding their cards close to their chests, prepared to hold off on announcements until the very last minute, and that’s worrying their staff”, said Hakan Enver, Managing Director, Morgan McKinley Financial Services.
“Professionals who want to stay in London, but are concerned about their roles being transferred overseas, are leveraging the shrinking window of time to try and secure a job locally.”
