Bank of England Governor Andrew Bailey noted that the hit to financial services was less severe than originally predicted|David Jones|CC BY 2.0
In June 2016, the United Kingdom voted to leave the European Union. A decade later, data suggests that the country’s economic growth has taken a hit.
Researchers at Stanford University, drawing on Bank of England data released ahead of the referendum’s 10th anniversary, estimate that Brexit has reduced UK economic growth by 6% since the 2016 vote.
The study, co-authored by Stanford Professor Nick Bloom and Bank of England economists, analyzed internal Decision Maker Panel data from thousands of British businesses. When combined with five broader economic analysis methods, the estimated average loss rises to 8%.
The analysis found that 50% of the economic damage stemmed from post-referendum uncertainty, while the remaining 50% was caused by trade barriers that came into effect after the UK exited the single market and customs union in 2021.
BoE Governor Andrew Bailey recently corroborated the study findings, noting that reduced export markets have negatively impacted growth and productivity in Britain. However, he said that the hit to financial services was less severe than originally predicted.
Some economists question the findings, arguing that global shocks—including the European energy crisis and stronger US investment and technology growth—make it difficult to isolate Brexit’s true economic cost.
Prime Minister Keir Starmer is now preparing to meet EU leaders in July to discuss agreements on food and farm exports, electricity and emissions trading, and broader economic cooperation.