Brexit & Tech Next Steps
During the UK referendum build up, the tech sector was vocal on its want for Britain to stay in the European Union. After all, the technology industry, more than most, has a strong international focus and the possibility of an independent and autonomous UK sparked widespread concerns. In the aftermath of the ‘leave’ vote, there has been a great period of volatility, with much industry and press speculation on the future of the industry. However, on 29th March, Theresa May will trigger article 50 and we’ll start to see the outcomes of this historic journey. What are the Brexit Tech Next Steps? Here’s a Pivigo prediction on how Brexit will affect the technology sector (spoiler alert: it’s not all bad).
A period of clarity
During the ‘cooling off’ (post referendum result) period, many tech companies were seen to get cold feet. Microsoft famously threatened to ‘pull out of the UK’ in a statement that sent ripples through the industry, while many fintech start-ups had investment backing cancelled or postponed. A great number of tech companies began immediate action, refusing to ride any period of uncertainty, and an exodus of some fintech companies began. The saving grace is that this unknown period is soon to be replaced by action, and many tech powerhouses are weighing in to affirm their belief in the UK’s technology industry. Silicon Valley giants Facebook, Google, Microsoft, Apple and Amazon have announced their plans for major investment in the UK, in a promise that brings thousands of jobs (Google alone is committing to 3000 jobs by 2020). While Snapchat have vowed to make their HQ in London.
Silicon Valley of Europe
Not only this, but with these heavyweights asserting their confidence in the UK, the dream of making the UK a European technology hub (on par with Silicon Valley, in the US) is reignited (with stiff competition from Paris, Berlin and Lisbon). Going in the UK’s favour, is the fact that Apple, Facebook and Google have all been seen to have run-ins with the EU, while the UK are generally recognised to be supportive of growth and development.
This is not to overlook the negatives that come with Brexit, or change of any type. While the majority of forecasts support a prosperous time for UK tech, it’s also comforting to know that if the worse could happen – the industry is equipped. This includes weathering any period of adjustment in response to change. For example, there has been some small speculation of financial crash, and certainly many company’s withdrawal from the UK might serve to warrant this. Others are concerned about the UK’s potential to source the best global talent when visas become a hindrance. After all, according to techUK one in six UK tech new hires in 2009-2015 were EU citizens. However, before we panic, know that the technology industry has spectacular coping skills. Tech businesses are resilient, we’ve seen this over and over again. Microsoft and FedEx started out in the 1973–1975 oil crisis and US recession, Skype was founded in 2002, during what was still the dotcom nuclear winter. Whereas, Airbnb, Spotify and Uber were born during the 2008–2009 financial crisis. This, if it turns out to be a crisis, will be no different.
The fact is, businesses and sectors continue to thrive even when conditions are not optimal. The UK continues to offer a low rate of corporation task, and a high skill pool of scientists and engineers. As Dyson tycoon, Sir James Dyson, reiterates (as he prepares to expand UK operations with a £2.5bn investment) “[Britain is a] great place to do business”.
In any situation, it’s important to look for positives, Brexit is no different. Efficient and agile businesses will still continue to do well. Tech businesses with business models that are less reliant on geographical borders should be able to continue to operate without much disruption. Many UK tech companies, Pivigo included, source talent from around the world and will still be able serve customers in the UK, and around the globe, from a UK base.
Here at Pivigo, we largely support initiatives that serve to show the strength and adaptability of the UK tech industry. #LondonIsOpen is a campaign – launched by the Mayor, Sadiq Khan – to show that London is united and open for business, and to the world, following the EU referendum:
“We don’t simply tolerate each other’s differences, we celebrate them. Many people from all over the globe live and work here, contributing to every aspect of life in our city. We now need to make sure that people across London, and the globe, hear that #LondonIsOpen. I urge everyone to get involved with this simple but powerful campaign to send a positive message to the world”
Later this month, Pivigo CEO Kim Nilsson will join Sadiq Khan on a trade mission in Berlin – where we shall help to quell Brexit impact by reminding Europe (and the world) that the UK will remain the very best place do business. Thankfully Apple, Facebook, Dyson, Snapchat, Google and many other world-leading tech powerhouses more than agree with us.