The Day After Brexit: What a Crash Out of the EU Might Look Like
“9:30 a.m., near Stafford, West Midlands, central England
The smell of melting acrylic fills the factory floor at Goodfish Ltd. Machines whir noisily, pumping hot plastic into moulds to make handles for violin cases, rake heads for golf bunkers, fog-light holders for Mini automobiles.
“Owner Greg McDonald is perched on a silver medicine ball in the boardroom, watching a video feed of the operation. Before the Brexit referendum, he wrote a note to his 126 employees about why leaving the EU would be bad for jobs. The majority ignored him, voting for it anyway. Now his staff is down to 96. Goodfish’s sales have fallen 20% so far this year. Meanwhile, the weak pound has made his remaining employees’ annual holidays more expensive, and they want a raise. He hasn’t been obliging.
“McDonald pulls out a MacBook Pro and loads the PDF of his Brexit contingency plan. Line item 2 reads, “Push button on investment to CEE”—Central & Eastern Europe. Goodfish’s major European customers don’t want to risk a production shutdown due to a delay in parts leaving the U.K. or to bear the costs of new tariffs. He knows they’re ready to shift supplier contracts to factories on the Continent and wants to preempt the loss of business. Setting up a factory in Slovakia will cost half a million euros, a major outlay when sales are falling.
“McDonald closes the laptop and glances back at the monitor. He’s already had to cut working hours from 48 hours a week to 40, hitting his employees’ take-home pay. He wants to keep jobs in the U.K. if at all possible, but if the calls start coming from his big clients demanding action, he’ll have no choice.”
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Mayes, J., & Morales, A. (2019). The Day After Brexit: What a Crash Out of the EU Might Look Like. Retrieved from https://www.bloomberg.com/news/features/2019-09-25/what-happens-the-day-after-a-no-deal-brexit