Britain still bears Brexit scars, 10 years after EU referendum

Britain’s long-run productivity is expected to remain 4% lower than it would have been inside the EU, the Office for Budget Responsibility projects. The OBR also expects UK exports and imports to be around 15% lower in the long run than they would have been if the country had stayed in the bloc.

Brexit has left a lasting mark on the economy, even as Covid-19, the post-pandemic inflation spike and the energy shock after Russia’s invasion of Ukraine also hit growth. A National Bureau of Economic Research paper estimated that by the end of 2025 Brexit had reduced UK GDP by 6% to 8%, investment by 12% to 13%, employment by 3% to 4% and productivity by 3% to 4%. Britain has also ranked near the bottom of the G7 for per-capita growth through the post-vote period.

Consumer price inflation was 2.8% in the 12 months to May 2026, while CPIH was 3.0%, according to the Office for National Statistics. A Reuters review found Britain had recorded higher inflation than any other Western European country except Austria since the vote, with consumer prices up 41.4% as of May 2026.

In December 2025, the British Chambers of Commerce surveyed 989 businesses, 96% of them small and medium-sized firms, and found that 54% of exporters said the UK-EU trade deal was not helping them grow sales, while only 16% said it was helping them grow sales in Europe. More paperwork, regulatory divergence and limits on business mobility remain persistent obstacles.

Michael Harte of Bridge Cheese said the firm stopped selling to the continent after the 2021 trade deal because mandatory veterinary checks cost £500 per inspection, alongside customs paperwork and border delays. Bridge Cheese once moved a pallet of cheese to France or Ireland in two days; now it has shifted toward Hong Kong and expects to sell more processed cheese there than the 100,000 tons a year it once sent to Europe. Britain left the EU single market and customs arrangements on January 1, 2021, and the trade deal that followed preserved tariff-free goods trade but left services access and business mobility constrained.