Statistically six out of every seven of you voted Remain. So it isn’t a surprise that Brexit came as a surprise to many, especially in university. However, Brexit has arrived and with the PM Theresa May stating “Brexit means Brexit” there is little hope of the referendum being taken as an advisory referendum.
Although there have been concessions made to EU students studying; regarding grants, loans and fees, the situation after one graduates is still as murky as to begin with. In the long run, a lot will depend on the type of Brexit that is decided upon. The Brexit type won’t matter as much in the short term. The financial industry has been particularly vocal up until now as they stand to lose the “passporting rights”, which are essential to their business in the UK. To explain them ever so briefly, they allow firms to sell their services in any European Economic Area (EEA) state without establishing a subsidiary. Therefore, should these rights be revoked, a portion of the financial industry will have to move its HQ out from London.
What this has meant is that the financial industry will likely be a forerunner for Brexit effects. So far the picture for graduates does not seem pleasant. Smaller banks are already starting to relocate, with larger banks expected to start in the first quarter of next year according to the chief executive of the British Banking Association. To take an example of the scale; Goldman Sachs is drawing up plans to transfer around 2,000 employees to another EU location. It only has around 6,000 employees in London. This will be a blow to the people in the Business School.
In the broader context, a recent employer survey by the Institute of Directors said that a quarter of employers were planning to freeze recruitment. However, a third stated that they would continue hiring at the same pace. So the picture looks mixed overall, as a fifth also said that they would move operations abroad. However, certain industries will be hit harder than others; banking, finance and law will probably all see a sharper decline in vacancies then more internally focused industries such as property or public services. Manufacturing might even see a boost, given a weaker pound.
In all of this the British Students seem to do the best, even with the potential of a recession and lower real pay as inflation rises. Employers said that if freely hiring EU graduates became unavailable, then a quarter of them would increase recruitment of British graduates. Although there are figures and statistics here, one can only wait to see the true impact of Brexit. While the situation will be okay for individuals in their second or penultimate year, the prospects for first years and current applicants to university will be unclear for some time to come.
By Tim Knickmann