Brexit vote – a defining moment for UK tech businesses
Ian Parslow, SVP at MTI Technology - 11 March 2016
The British EU negotiations and impending Brexit referendum have cast a heavy shadow on UK business. In particular, the tech sector has been seen as one of the sectors that will suffer the most from a potential exit. The looming referendum could negatively impact on UK tech companies by removing a precious ingredient required for growth – talented and skilled people from the EU states.
This access to skilled talent is crucial for tech businesses, both young start-ups and established companies. For hungry, tech start-ups, in particular, access to talent is vital to their growth - one cannot happen in absence of the other.
Global reputation of the UK and London
The threat of an exit has already cast a negative perception over the UK for other EU and foreign countries. Foreign companies look to use London as an access point to Europe – the partial reduction in membership does not reflect well on the UK, but a full-blown exit could tarnish the UK for many foreign organisations. It will remove existing trading and regulatory links that makes the UK an attract bridge to the EU.
A reduction in our membership to the EU has the potential to lessen our global influence in business and technology, and make London and the UK as a whole, a less attractive location for prospective businesses and talent. Businesses would no longer be able to enjoy the regulatory access to the EU. They would have new obligations in order to access the single market and would be likely to suffer from restrictions in the movement of migrants from EU states.
The future outlook on UK tech businesses could be challenging to say the least if the UK left the EU. It would lose the existing business links to the EU’s single market. This would create extra regulatory barriers and legislation to go through to continue to trade.
Although there is high regard for UK as a centre for global business, as well as other cultural and historical draws, an exit from the EU could leave it in a weaker state. The most detrimental aspect of a Brexit would be the new difficulties in sourcing skilled EU migrants, who play a big part in the UK’s growing tech sector. The changing requirements could make hiring EU workers a difficult process for all parties and, with reduced welfare for migrant workers, there might not be the same will to work in the UK, as other EU bloc states.