The politics of uncertainty
They say that a week is a long time in politics - if so, the last 12 months must have felt like an eternity for many.
It’s been a period of real political turmoil, both in the UK and abroad, with a string of elections and surprise decisions that have made predicting what might happen in the next 12 months almost impossible. With the unexpected vote for Brexit and now a shock General Election result on June 8 that has created a hung parliament, there is a growing feeling that political uncertainty is not good for business. And all this comes at a time when the UK is about to enter formal negotiations with its EU partners over the terms of any Brexit deal.
Reports from the Society of Motor Manufacturers and Traders (SMMT) back in January suggested that the uncertainty around Brexit was already causing issues in the UK car industry. Warning of a likely downturn in sales in the run up to any final Brexit deal, the SMMT suggested that growth could reverse, with sales declining by around 6% due a fall in the value of sterling.
In another worrying sign of a potential loss of confidence due to uncertainty around Brexit, in June the Institute of the Motor Industry (IMI) said that many business were reporting that they were struggling with recruitment. They’ve suggested that this is partly down to a skills shortage - due to the rapid technical innovation seen in the sector - but also blame the uncertain political climate as a contributory factor. Businesses are responding to the situation by training and developing existing talent from within their businesses, but investment in training is often dependent on support from central government.
An uncertain future
Clearly then, when the future priorities and direction of the government are uncertain - as they have been since the events of June 8 - there are serious implications for an industry already shaken by the upheavals of the last year. It certainly promises to be an eventful 12 months to come.