Article 50 - How Will it Affect the UK Tech Industry?

by Elise Milburn - over 2 years ago

As the UK officially prepares to withdraw from the European Union, the future of Britain's Tech industry remains uncertain.

On the 29th March, Prime Minister Theresa May triggers Article 50 and begins the two-year process of leaving the EU.

Earlier this year when Brexit was announced, IT industry body TechUK outlined the key tech priorities following the break from the EU, highlighting the importance of continued trade within the EU and cross-border data transfer.

In their opinion, this access is vital to ensuring Britain's continuation as a digital leader.

Julian David, CEO of Tech UK, said that Article 50 is the start of a 'historic process that will shape the future of the UK and Europe for generations to come."

"The EU and the UK government now have a responsibility to work together to secure a deal that supports the jobs and livelihoods of citizens across the UK and the EU," he said.

Britain is already currently facing a skills shortage, and in the latest Jobs Outlook Report from REC, one in five employers stated that a shortage of candidates is the main concern.

James Parsons, CEO and founder of digital solutions company Arrows Group said, "From a digital skills perspective, we're already seeing how Brexit is making top digital talent reluctant to come to the UK and flock elsewhere instead."

According to his company's data, there has already been a 10% reduction of skilled candidates from the EU coming to the UK, and UK talent is moving elsewhere.

"If this trend continues, it could lead to a brain drain of top UK talent, as generally, they will want to work where the exciting projects are," said Parsons.

"We're already seeing an increase in best-in-class developers taking roles in Switzerland which continues to be a fast-growing hub for tech innovation."

"Of course, this isn't welcome news to UK companies at a time where the UK digital skills gap is already large, and where a significant amount of tech talent comes from abroad. As the government takes these next steps, it's critical that it puts the right laws and incentives in place to keep top tech talent firmly on UK shores to enable innovation.

However, Tech City UK's annual report published recently paints a much more positive image.

The report found that the UK's tech industry had a collective annual turnover of £170bn in 2015, and £6.8bn was invested in Britain's tech companies which is twice as much as any other European country.

The government is also setting up a bright post-Brexit future, with aims to develop STEM skills, investment in science and innovation, and infrastructure upgrades.

Access to the EU single market

One thing that the industry is pushing for is confirmation that UK businesses would still have access to the EU single market.

TechUK highlighted that it wants the government to ensure maximum access to the single market for digital products and services, and to make sure that UK businesses aren't left out.

However, Theresa May has already said that it's "impossible" to leave the EU and remain part of the single market.

Founder of MuleSoft, Ross Mason, has said, "With Article 50 being triggered, it is clearer than ever to me that being outside of a digital single market would damage economic growth in the UK."

"A post-Brexit UK needs to be able to flourish in the global digital economy. Yet if Europe simplifies the rules of digital business and the UK is left out, businesses across the country will be at a disadvantage: not just those in the UK digital sector, but also all those companies that do business online."

Going into the negotiations with the EU, it is clear that the tech industry needs a new relationship with Europe that works for the current economy, and for tomorrow's digitally-enabled world.

Source: Computer Weekly

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