Brexit: Remain campaign ‘was project fear’ says Liz Truss
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And Professor David Blake said with the uncertainty now behind it, the nation was in a fantastic place to capitalise on all the benefits of standing outside the bloc. The Professor of Economics at City, University of London was speaking after the publication of the new Deloitte chief financial officer (CFO) survey which indicated more than half of UK finance chiefs said they have also seen a full recovery in demand for their businesses, or expect to by the end of the year.
Roughly 76 percent also said they expect to see increases in hiring over the year ahead – with expectations for both recruiting and spending at their highest levels in almost seven years.
Prof Blake told Express.co.uk: “It is certainly the case that businesses do not like to invest when there is uncertainty.
“The two key sources of uncertainty in recent years have been Brexit and the coronavirus pandemic.”
Since the start of the year, the UK had quit both the EU and the Single Market, so one source of uncertainly had been resolved, he explained.
Boris Johnson’s UK is set to thrive – confounding Brexit doom-mongers, said Professor David Blake (Image: GETTY)
Ursula von der Leyen, President of the European Commission (Image: GETTY)
Prof Blake said: “Remainers predicted that the economy would collapse as would our international trade. But neither has happened.
“Further, the brilliant success of our vaccine development and roll out has removed the second source of uncertainty.
“Freedom Day is July 19 and from then on we will have to live with the virus.
“This means that large parts of the rest of the economy, such as hospitality, theatres and cinemas, will now be able to open for business.
“This explains why business investment is predicted to surge in the coming months.”
Lord Andrew Adonis, a prominent Remainer, is closely associated with the concept of Project Fear (Image: GETTY)
Prof Blake said: “Business investment is essential for enhancing worker productivity, ie output per worker.
“Low worker productivity is one of the great weaknesses of the UK economy.
“Worker productivity is directly related to capital per worker and this in turn depends on capital investment.
“So an increase in business investment is to be warmly welcomed.”
The welcome recovery in the economy would also trigger an increase in the demand for workers, Prof Blake pointed out.
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Boris Johnson announces plans to lift COVID restrictions at Downing Street (Image: GETTY)
Covid vaccination rates compared (Image: Express)
He said: “Businesses are claiming that there are shortages of skilled workers and they are finding difficulty in recruiting.
“They used to rely on cheap labour from the European Union filling vacancies. But now that we have left the EU, that source of labour is no longer so easily available.”
It was precisely because of the ready availability of EU workers that businesses did not need to train young British workers via apprenticeships, Prof Blake pointed out.
As a result, many school leavers found themselves on the dole, with EU citizens doing the jobs that they could equally well do.
He added: “Having left the EU, businesses will have to do what they used to do – which is to offer training and apprenticeships to UK school leavers.“Hence, we could end up with a virtuous circle of new workers being trained to use new productivity-enhancing capital equipment which will increase productivity and wages and reduce unemployment.
Rule changes scheduled for July 19 (Image: Express)
What’s not to like?
Professor David Blake
“Also in the longer term, robots can and will do many of the jobs that British workers do not like to do.
“This has happened in Japan – a country that has never used immigration to meet labour shortages.”
Prof Blake acknowledged: “There are short-term problems to overcome, such dealing with the shortage of HGV drivers.
“This could be dealt with by offering short-term work permits to experienced foreign workers.“But overall things are looking up – the economy will fully recover from the pandemic later this year, business investment is booming, vacancies are at their highest level for years and real wages are also increasing at their highest level for years. What is there not to like?”
With respect to spending, the survey revealed finance bosses were placing greater emphasis on expansion plans, with 41 percent introducing new products and services, or expanding into new markets as a strong priority.
Five key moments which led to Brexit (Image: Express)
Meanwhile a takeover is a top priority for nearly one in three – the highest level for 11 years – and 22 percent said planned increases in capital expenditure over the next 12 months will be taking precedence.
Ian Stewart, chief economist at Deloitte, said: “With the economy reopening, CFOs’ perceptions of external uncertainty have dropped below the average of the last five years and businesses have tacked away from the defensive strategies that helped them through the downturn.
“The pandemic, like all major shocks, will reshape the economy and we are likely to see years of normal growth compressed into just a few months.
“Indeed, eight in ten CFOs believe that productivity will run higher in the wake of the pandemic.
“That offers the hope of a more comprehensive recovery than after the global financial crisis.”