Report shows North East and Yorkshire businesses are fearful of Brexit affects

Confidence among North East and Yorkshire business leaders about the long-term effects of Brexit on the UK economy and their companies has dropped to its lowest level in over a year, according to a new report.

RSM’s quarterly Brexit Monitor index, which was put together by polling service YouGov, found that sentiment towards the impact of Brexit on their business over a five-year period fell from 125 to 94.

Sentiment towards the impact on the UK economy over the next five years, meanwhile, has also slipped from a positive score of 116 to 95.

In the short-term, North East and Yorkshire firms are more optimistic about the economic health of the UK after Brexit, registering a sentiment score of 101, which remains the same as last quarter.

Over a third (38%) of Yorkshire firms feel exiting the European Union without a Brexit deal will have a harmful effect on their revenues, making it the most pessimistic of all regions. Of this group, 5% feel it would catastrophic and 33% feel it will harm revenues.

Of those asked, 42% feel a ‘no deal’ Brexit will have no effect, but 15% feel it will be favourable. The circumstance would be advantageous according to 5% of those regional businesses surveyed.

The survey found that 40% of North East and Yorkshire businesses have set up contingency funds to prepare for a ‘no deal’ scenario, while just 39% of regional business leaders are confident in the government securing a good deal.

Steve Railton, RSM’s office managing partner in Newcastle, said of the findings: “Early in the year, regional businesses seemed positive regarding the impact of Brexit, but the latest findings shows a significant shift in longer term sentiment as we get closer to the end of the negotiation period.

“Overall confidence levels appear to have taken a knock over the last quarter. This is likely to be due to the slow progress of negotiations and the growing fears around the government failing to reach a deal with the EU.”