The 2017 outlook from the Chartered Management Institute (CMI), which surveyed 1,118 managers across the UK, indicates 65% of respondents feel negative about the UK's economic outlook for the next 12 to 18 months, while half (49%) think Brexit will have a negative impact on economic growth in the next three to five years.
The referendum result was also considered to have had a negative immediate impact, with a mere two in five saying they had experienced growth overall in 2016, the lowest reading since 2012, and 22% saying that their business had actively declined. Similarly, 35% of managers lack confidence in current UK leadership and management's ability to capitalize on post-Brexit opportunities.
I really hope any Brexit works out well for UK & neighbours.— Simon Cox (@SimonFRCox) December 26, 2016
I am also really pessimistic it will.
Hope & pessimism aren't incompatible.
On the impact of Brexit on economic growth in the next three to five years, 49% thought it would be negative, although 37% did believe leaving the EU could have a positive impact on the UK economy, and 14% thought it might have no impact.
Managers also said tackling the UK's poor productivity was a priority in 2017, and they wanted to improve economic efficiency by investing in technology, improving management skills and cutting bureaucracy.
On the election of Donald Trump, 40% thought his victory would have an negative impact on the UK, although almost as many (31%) thought it could be positive for the UK.
The findings largely echo the sentiments expressed by members of the Confederation of British Industry in a December 21 study.
Many sectors of the UK economy have specific concerns about how their relationships with their continental counterparts will be affected by Brexit. The aviation sector demand the UK government seeks agreements allowing the smooth transport of holidaymakers, workers and goods, as do logistics companies, haulage firms and retailers.
Restaurants are uncertain as to how they will continue to hire chefs from abroad, while chemicals and plastics companies are asking whether they will still be able to access the skilled employees they need at their plants. This is also an issue for logistics firms who already face a shortfall of nearly 35,000 drivers.
Construction companies are worried about potential extra costs of importing materials and the future of the CE marking regime, as are many manufacturers. The UK's creative industries are anxious about Intellectual Property and data flows, as are life sciences businesses, technology companies and other sectors.
The report identified that many legal requirements have cross-sector implications — for example, energy and environmental regulations have an impact on construction, housing, manufacturing and water companies. The success or failure of some sectors could affect others — the future of financial services regulation, for example, has been raised by firms in the automotive, housing, real estate and retail sectors, given the role they play in finance, insurance and pensions.
Carolyn Fairbairn, CBI director-general, said that while each sector has issues specific to it, there are many commonalities uniting them:
"Where companies differ is how they prioritize these issues and the contrasting emphasis they place on trade, migration and regulation.
"To make a success of Brexit for the whole economy, Government needs to work through all these issues, as well as seize the opportunities afforded by a new focus on the UK's global economic relationships.
Firms of all sizes want to understand how easy it will be for them to trade in the future with the EU which remains the biggest market for British businesses. They need to know what rules they will be working by and how they can still secure access to skilled workers and labor, where shortages already exist."