It’s been three long months since the UK decided to jump ship and Brexit the EU. But exactly what’s happened in the time since the referendum of all referendums? Last week, Mintel decided to discuss the answer to that very question and, fortunately for you, our most strategic minds were invited along. Want to know what we found out? Here’s a handy 5-point summary:
1) So far, we’ve seen little of the devastating economic impact the so-called ‘doom-mongers’ predicted – unemployment, GDP and real wages have all held steady. However, we’re seeing the impact in foreign exchange (with the Pound taking a hit), whilst businesses are also already feeling the heat. The cost of imports has risen, inflation has jumped and investment has dropped – eg. the value of infrastructure and industry contracts has fallen by 20% since July.
2) Remarkably, people are generally still feeling somewhat confident about the impact of Brexit on their personal finances. However, this varies significantly between demographics. High earners (ironically, the majority of whom voted Remain) are more likely to feel confident about their money moving forward – probably because they’ve got some. At the other end of the spectrum, only 20% of people earning less than £15k feel confident about their finances in the next 12 months – even though they were more likely to vote Leave.
3) In the immediate aftermath of the vote, we were – for lack of a better word – shit-scared about what the impact of Brexit could be. All in all, we felt like it could have a negative impact on everything from the economy and housing market to career prospects and the cost of living. But since then, we’ve sorted ourselves out. Today, amazingly, we feel that on balance Brexit will be a good thing for the economy, unemployment, the housing market, household income and career prospects. Albeit we’re still not convinced it’s going to help the value of our savings and the cost of living.
4) The implications of this, for now, are still unknown. We’re not worried because at the moment we’re still pre-Brexit – nothing has actually happened yet. It’s likely to further fuel the trend to savvy shopping (trading up and down), precede a further increase in staycations, and a push-back in big ticket purchases as we wait to see what happens before dropping a tonne of cash on a car, house, new conservatory or whatever tickles our fancy. It’s a big opportunity for British brands, especially luxury ones, as we’re likely to see an increase in rich Americans and Chinese coming over for a shopping holiday. And, interestingly, it could also give rise to even more obesity, as fruit and veg (which we tend to import) could become significantly more expensive. Ouch.
5) The beauty of research – occasionally people say it how it is…
Reference: Mintel, Big Conversation, September 2016