A Decade After the Referendum, Britain Is Still Reckoning With the Economic Cost of Brexit
Ten years on, the long-term impact of leaving the European Union continues to shape growth, trade and investment decisions
Ten years after the United Kingdom voted to leave the European Union, the economic consequences of Brexit are still unfolding, with costs that continue to accumulate rather than fade.
While the referendum result was framed as a decisive moment of regained sovereignty, the years since have revealed a more complex picture in which trade friction, weaker investment and slower productivity growth have weighed on the economy.
Multiple independent assessments now converge on the conclusion that the UK economy is smaller than it would have been had it remained in the EU, even as global shocks such as the pandemic and energy crises complicate precise measurement.
Exports and imports with the EU have not collapsed, but they have underperformed relative to comparable economies, reflecting the drag of new customs procedures, regulatory divergence and higher compliance costs.
Small and medium-sized businesses, in particular, have struggled to absorb the added bureaucracy, leading some to scale back cross-border activity altogether.
Foreign direct investment, once a clear UK strength, has also been affected as multinational firms reassess the country’s role as a gateway to Europe.
Labour market pressures have intensified as freedom of movement ended, contributing to persistent shortages in sectors ranging from agriculture to health and social care, and pushing up costs for employers.
At the same time, promised gains from regulatory freedom have been slower to materialise, with successive governments cautious about diverging sharply from EU standards for fear of creating further barriers to trade.
Supporters of Brexit argue that long-term benefits will still emerge through new trade deals and policy autonomy, but a decade on, those advantages remain modest compared with the measurable economic losses.
As the UK looks ahead, the challenge is less about relitigating the referendum and more about finding pragmatic ways to reduce friction with its largest trading partner while rebuilding growth and competitiveness in a post-Brexit reality.
While the referendum result was framed as a decisive moment of regained sovereignty, the years since have revealed a more complex picture in which trade friction, weaker investment and slower productivity growth have weighed on the economy.
Multiple independent assessments now converge on the conclusion that the UK economy is smaller than it would have been had it remained in the EU, even as global shocks such as the pandemic and energy crises complicate precise measurement.
Exports and imports with the EU have not collapsed, but they have underperformed relative to comparable economies, reflecting the drag of new customs procedures, regulatory divergence and higher compliance costs.
Small and medium-sized businesses, in particular, have struggled to absorb the added bureaucracy, leading some to scale back cross-border activity altogether.
Foreign direct investment, once a clear UK strength, has also been affected as multinational firms reassess the country’s role as a gateway to Europe.
Labour market pressures have intensified as freedom of movement ended, contributing to persistent shortages in sectors ranging from agriculture to health and social care, and pushing up costs for employers.
At the same time, promised gains from regulatory freedom have been slower to materialise, with successive governments cautious about diverging sharply from EU standards for fear of creating further barriers to trade.
Supporters of Brexit argue that long-term benefits will still emerge through new trade deals and policy autonomy, but a decade on, those advantages remain modest compared with the measurable economic losses.
As the UK looks ahead, the challenge is less about relitigating the referendum and more about finding pragmatic ways to reduce friction with its largest trading partner while rebuilding growth and competitiveness in a post-Brexit reality.
