The effect of Brexit on IT Services
We all know Brexit is going to happen and will have an impact on our business and social life. When you are trading with the EU these are insecure times. However will Brexit have an impact on IT consultancy services?
A lot of computers and related equipment are made outside the UK and often even outside the EU. This will mean that prices of computers or parts will change. It can also mean that contracts with suppliers might need to be negotiated again after Brexit. Also a factor in the price of materials can be the value of the Pound Sterling. It is very unpredictable how the Pound Sterling will develop during and after Brexit and this will make it difficult to plan a business strategy when it comes to costs.
Also many IT service providers also make use of foreign employees. A large percentage of these foreign workers are from the EU. Even though the latest news when writing this article is that nothing will change for EU nationals currently working in the UK it will certainly have an impact on attracting IT skilled EU nationals after Brexit. It may be more expensive or more difficult to attract EU nationals to work in the UK.
Another effect of Brexit might be that foreign companies will move to their main office to the EU. This will mean a smaller market of clients for IT companies in the UK. A possible outcome if this can be that prices for IT consultancy services will go down and can leave some IT companies in a uncertain situation.
However there are also possible positive outcomes from Brexit for IT consultancy companies.
IT companies and (local) government can work together and invest to develop a local or national IT workforce. By joining forces this can result in a great opportunity for the UK in terms of employment status. Especially when it will be more expensive to hire IT technicians from the EU the chance of employment for IT technicians from the UK will be much greater.
In addition to the above the UK can also start developing its own new technologies and parts in the UK. When developing a skilled workforce in the UK a part of this workforce can be trained to work in projects to develop new technologies and materials which can benefit the whole IT sector inside the UK. It will provide a great opportunity to compete with a large market like the EU and open up possibilities on a national level.
In conclusion Brexit will have an effect on IT consultancy services in the UK. It will probably come with a smaller market and initially rising costs of materials and workforce. However it also provide great opportunities to develop a strong UK based IT sector. Not just for the IT consultancy companies but also for the IT developing and material manufacturing side of the industry.