Unhappy New Year: UK bosses pessimistic as March 29 looms and France tipped to overtake Britain economically
UK business leaders' confidence in their economy has plummeted as uncertainty about Brexit continues ahead of the proposed March 29 withdrawal. The cautious optimism shown by company bosses earlier in 2018 has gone, according to a survey by the Institute of Directors (IoD).
Overall optimism, which had briefly reached positive territory following the initial agreement of a Brexit transition period, has fallen steadily since April and hit its lowest point in December.
All regions and nations of the UK are now reporting a pessimistic outlook for the 12 months ahead. Directors remain confident in the future for their own organisations with a net 30pc positive rating, but the response for the economy overall was a net minus 38pc, the lowest for 18 months.
The IoD's findings are based on 724 total respondents, with work conducted between December 5-20. Studies in previous months have involved between 700 and 1,000 bosses. The main concerns highlighted were general economic conditions, the trading relationship with the EU and skills shortages. The lack of clarity about whether or not the UK will leave the EU with a Brexit deal - and the crucially important transition period to avoid a sudden change in trading conditions - appears set to hold back investment.
Tej Parikh, senior economist at the Institute of Directors, said: "Business leaders are looking ahead to the new year with trepidation."
The survey comes after an economic think tank suggested France will overtake the UK to become the world's sixth biggest economy next year. The Centre for Economics and Business Research (CEBR) said "disruption" to the British economy was inevitable due to lower inward and business investment. However, the CEBR's World Economic League Table report says post-Brexit Britain will return to the sixth spot by 2020 - a position it is expected to retain through to 2033.