How Brexit has impacted the technology sector

Uncertainty is never good for business. Every industry has been affected by Brexit uncertainty in one way or another since...

Andy Bristow
Andy Bristow
5 min read Reading Time
27 January 2020 Date Created

Uncertainty is never good for business. Every industry has been affected by Brexit uncertainty in one way or another since the first referendum. The technology sector by nature spans across country borders and links employees, employers, clients and customers throughout the EU and beyond. So what does this mean for IT jobs and recruitment?

After the December UK general election brought PM Boris Johnson and his party a historic majority in the House of Commons, you would assume that uncertainty about “getting Brexit done” would all but disappear by the new year.

But there’s still a long road ahead. And it’s a road full of potholes, confusing roadsigns and blind corners.

In October, Johnson did manage to persuade EU leaders to renegotiate the withdrawal agreement and non-binding political declaration. But ultimately, he couldn’t secure approval from parliament and had to ask for another extension, which the EU granted until 31 January 2020. This means that technically, all options are still possible for the next stage of the Brexit saga. From a no-deal exit to a second referendum, from another renegotiation to revoking article 50 entirely.

However, now that Johnson has the numbers to secure parliamentary approval, we could see some fast-paced developments through the start of January 2020.

While the strength of the technology sector has stood up against the uncertainty of Brexit, companies, suppliers and employees still have to deal with a lot of unanswered questions.

Attracting talent

After Brexit, freedom of movement, a key principle of the EU, will end. Uncertainty from the UK about the future of EU citizens living and working here has lead to reciprocal uncertainty from EU member states about the future of new and existing UK workers living abroad as well.

Tech skills are in high demand and competition is tough for IT recruitment. If tech companies have to wrangle new visa rules and work permits in the post-Brexit future to get the best talent from across Europe, this will have a huge impact on recruitment resources.


Currency fluctuations, threats of tech companies leaving the UK and a potential lack of skilled workers have meant that while investment in the tech sector is still strong overall, there is a certain level of hesitation when it comes to new investment in the UK technology industry. The European Investment Bank backed only 3 UK investors in 2017, compared to 20 in 2016.

Growing tech hubs like the East of England do continue to attract a lot of exciting new business, but the future remains a little uncertain for those all-important cross-border partnerships.

Data flows

Remember the flurry of emails that landed in your inbox not too long ago about GDPR? Well, that regulation of personal data is overseen by the EU. The technology sector relies on vast amounts of data to provide services and develop new products.

For UK tech companies after Brexit, this will mean ensuring that data protection laws are being followed and there are no gaps in security. But in these uncertain times, a lot of the decisions about exactly how to approach the process for checking adequate data protection compliance have yet to be addressed.


A good contract should address and manage risk, which is why tech companies will have to take a look at all of their commercial contracts in the run-up to Brexit. Issues like delays and extra tariffs at  borders and customs points, changing legal frameworks and issues of pricing, VAT and currency exchange rates are all things that may need to be addressed with new eyes once the UK leaves the EU.

What businesses can do to prepare?

The best thing you can do as a tech employer in the East of England in times of Brexit uncertainty is to reassure your stakeholders, customers and most importantly, your employees. While you may not be able to provide absolute certainty to worries about residency and employment status for EU workers in the UK and vice versa, you can proactively engage with your employees and show them that you’re doing your best to keep up to date with all the latest information from the government, trade associations and industry bodies.

The countdown to the next deadline of 31 January 2020 has begun and IT recruiters and employers across the tech sector are waiting for the newest developments. What questions will be answered and what new ones will need to be asked next? It’s clear that Brexit will have a lasting impact on the UK technology industry, so keep your IT teams strong and hire the best talent to secure your future in East of England’s exciting tech landscape.