Brexit would pose a risk to UK engineering

Posted on 26 Apr 2016 by Jonny Williamson

The Institution of Engineering and Technology (IET) has outlined the risks that leaving the European Union could have on the UK engineering sector, including increased skills shortages and uncertainties over areas such as research funding.

Leaving the EU, the IET stated, could exacerbate the UK’s engineering and technology skills shortage – the UK is estimated to need 1.82 million new engineers over the next decade – by making it more difficult for companies to recruit engineers from other EU countries.

While the UK could tackle this problem by introducing a fast track visa process for engineers and technologists, it is unclear how this would sit alongside the tighter border controls anticipated following an exit from the EU.

Other identified risks for UK engineering associated with leaving the EU include:

  • Damage to engineering and science research, since both funding and international collaboration would be likely to suffer. The UK receives more funding for scientific and engineering research than it contributes to the EU – and it is not clear to what extent the UK might be able to access that funding directly if the UK left the EU. More importantly, losing a formal EU collaborative environment and access to influencing the direction of EU research would both be a significant loss to the UK.
  • A decline in the UK’s influence on global engineering standards – which is essential to the health and growth of the engineering sector. Designing equipment to meet global standards is how companies access world markets. Taking mobile communications standards as an example (in which the EU, with strong UK input, has led the world), the UK could not create its own standards and expect to have them honoured in any significant market, nor would it be able to influence the European standards. This would mean it would inevitably be late to some new markets, unless it became a prominent member and influence in an international standard making body to improve trade with the US or China.
  • Losing automatic access to the EU market and needing to negotiate new independent Trade Agreements. It is not clear that forming new agreements with the UK would be a priority for other trade groupings and countries, nor that the UK would have notable negotiating leverage. Although the UK might over time become incorporated in other treaties, there would inevitably be a delay while those treaties were agreed and during which trade would be damaged.

Naomi Climer, president, the IET.
Naomi Climer, president, the IET.

IET President, Naomi Climer explained: “UK engineering is deeply integrated with global markets and companies, and the period of uncertainty about the terms on which access to these would be granted to UK companies after a decision to leave the EU is a threat to the sector.

“Given the considerable challenges already facing UK engineering and technology, it is difficult to justify the unknown and unquantifiable transition risks if we were to leave the EU. While it is possible that these effects could be mitigated by other trading and collaboration arrangements after an exit from the EU, there are no guarantees.

“For this reason, the interests of engineering and technology may be best served by the UK remaining within the EU, and we are calling for urgent discussion on the impact of an exit decision on a sector that is so vital to our country’s economy.”