“Research shows the Leave vote had a sizeable negative effect on the economy even before the UK left the EU. Based on available evidence, our judgment is that the UK’s economy was around 2-3% smaller at the end of 2019 than it would have been if the UK had voted to stay in the EU. This decline equates to a GDP loss of between £650 and £1,000 per person per year.”
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The weaker pound also raised the cost of businesses’ imports of intermediate goods. This cost increase hurt workers by reducing real wage growth in more exposed regions and industries.. At the same time, data shows that the fall in sterling did not generate any long-run gain in the price competitiveness of UK exporters, which may explain why it did not lead to a rise in export volumes.
ukandeu.ac.uk
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