Brexit continuing to impact poorer households the most five years on

Migrants, small businesses, young people, and poorer households are the most adversely affected groups five years on from Brexit, according to a new research report from LSE IDEAS, London School of Economics and Political Science.

Iain Begg, Professorial Research Fellow at the European institute, LSE, authored a post-Brexit audit analysing the economic, social, and governance challenges faced on both sides of the English Channel since the UK’s exit in 2020.

Brexit is generally agreed to have had a negative economic effect on both the UK and the EU, but with a greater 'hit' to the UK. However, estimates of the magnitude of the impact are contested and the succession of economic crises (the pandemic, the cost of living) make it hard to be precise.

However, Begg’s analysis suggests new trade deals secured by the UK with Australia, New Zealand, and India have proven inconsequential in patching up the impact of Brexit on trade with the EU.

The higher cost of food imports to Britain has had a direct impact on consumers. Poorer households have been affected in particular, due to food and other necessities typically constituting a larger share of their household budgets.

Social relationships within households have also been impacted, with familial tensions arising where one member is an EU national and the other is a UK citizen, for example around whether to apply for ‘settled status’.

Begg also highlights a 2022 analysis of data in the UK Household Longitudinal Survey which finds that the Brexit referendum is linked to a subsequent worsening of mental health. Remain voters, 31-46-year-olds, men, and highly educated individuals were the most affected demographics.

In terms of governance, the UK’s ability to escape an ‘over-bearing Brussels’ and chart a new regulatory trajectory was a key selling point for Brexiteers. However, the UK has since transferred many EU regulations into national law.

A policy of dynamic alignment, in which the UK would broadly follow changes in EU regulations, is proving a controversial pathway. Begg says the tension is felt especially in Northern Ireland, where Unionists perceive a risk of undermining the Union if there is a substantial regulatory divergence with Great Britain.

Begg suggests the UK-EU Summit in May 2025 marks a substantial ‘reset’ in the relationship, signalling willingness on both sides to bolster economic and security collaborations, in addition to addressing pressing global issues such as immigration and climate change.

“In all these respects, the future of the UK-EU relationship remains crucial to the interests of both sides,” he says.

/ENDS

For more information, a copy of the report, or to speak with Iain Begg, contact Jamie Hose at BlueSky Education on jamie@bluesky-pr.com, or call +44 (0)1582 790 706