Three quarters (74%) of business leaders expect the general economic condition of the country will decline over the next 12 months, up from 66% this time last year. Just 8% expect it to improve.
The overwhelming majority of the FTSE 500 see the resolution of uncertainty around Brexit as the most important issue facing Britain today (95%).
Most are not confident in the ability of the government to negotiate a good deal for UK businesses with the EU (68%). Only one fifth (19%) of business leaders agree they are confident.
Business leaders’ confidence in economic policy remains low. A third (38%) disagree with the statement that in the long term, this Government’s policies will improve the state of the British economy, which remains unchanged since last year. At the same time they prefer the Conservative government to those of the opposition, with 94% of Captains disagreeing that Labour’s policies would improve the state of the British economy.
Over half (55%) of business leaders view the decision to leave the EU as a significant risk to their company and three quarters (73%) disagree with the statement that the decision to leave the EU will bring significant new opportunities for their company.
They think Brexit to date is worse than they predicted 12 months ago. Some 67% feel that the business situation for their company is currently worse than it would have been if the UK had voted to stay in the EU, whereas last year only 56% Captains predicted they would be experiencing a worsening position by now. Three in ten (30%) feel that since the referendum the business situation for their company remains unchanged. This is an accurate prediction, as Captains last year predicted that 30% would state that voting to leave would make no difference to them.
Despite their pessimism, FTSE 500 bosses nearly all (92%) agree that they are confident that their company can adapt to the consequences of leaving the EU and half of business leaders (50%) expect the business for their own company to improve over the next 12 months, with one fifth (19%) expecting it to get worse.
Looking forward, three quarters (78%) of business leaders think that overall, the UK leaving the EU with no deal would have a negative impact on their business.
Ben Page, CEO of Ipsos MORI, said:
Britain’s largest businesses feel Brexit is having a more profound impact on British business than our business leaders thought it would a year ago – 67% of Captains think that their company is worse off. As with the public, business is losing confidence in the government’s ability to manage Brexit, but have no confidence in Labour doing any better. More positively, most think they will adapt, but nearly all think leaving the EU with No Deal will be bad for their business.
The study is one of the longest running studies of senior business people in the UK, having been undertaken every year since 1981. As every year, Ipsos MORI conducted 100 interviews with Board members from the top 500 companies by turnover and the top 100 by capital employed in the UK. Participants were Chairmen, Chief Executive Officers, Managing Directors/Chief Operating Officers, Financial Directors or other executive board directors. Interviews were primarily carried out face to face (6 were carried out over the telephone) between September and December 2018.