Around 250,000 jobs in Yorkshire are estimated to be linked to EU exports, and two thirds of business leaders urged voters to choose Remain. But overall 58% percent of voters decided to Leave – only the cities of Leeds, York and Harrogate had a Remain majority.
A number of difficulties now face Yorkshire businesses. The drop in value of the pound, which has still not recovered, makes international trade much more expensive. While Yorkshire doesn’t import as much as the south of England, we still have a negative trade balance of about £5 billion – a figure that will increase as our currency loses value.
Over £75 billion worth of goods (47% of all trade) are exported annually to the EU from Yorkshire, and it’s unclear what limits and barriers will be put in place post exit.
The volatility of the markets has left many foreign investors less inclined to start businesses on British soil, and those employing EU workers at present are still unsure what their status will be post-Brexit.
The response from the government is still unclear. It is certainly possible that initiatives like the Northern Powerhouse could see reduced funding from Westminster. But James Wharton, MP for Stockton South and a key figure in the Powerhouse agenda, says that the Northern Powerhouse is “potentially strengthened by Brexit”. Cutting off ties to Europe means that our internal links must become even stronger, and it opens up the opportunity for “the North of England to trade with the whole world”.
There are likely to be other benefits for those in the hospitality and tourism industries though – the increased price of holidays abroad may lead many to choose “staycations” over flying overseas, while European travellers are more likely to visit the UK now it’s cheaper for them.
And property market experts are optimistic that the forecasted drop in house prices could be a very good thing for first time buyers, enabling them to get on the property ladder more easily. With interest rates very low, it’s likely to be the best time for young people to get a mortgage and a house.
And for those with worries about whether Leeds’ European City of Culture bid is at an end, fear not – cities in Iceland and Norway, who are not EU members, have held the title before.
If you would like to find out more about how the EU referendum will affect Yorkshire and business in the region, the best event to come along to is our Bank of England Lunch on 20th July, where Raakhi Odedra, new deputy agent for the Bank of England, will be speaking about its Financial Stability Report which was released on 5th July. Find out more details here.