It's hard to ignore the effects the Brexit is having on engineering. The first physical marks the Brexit referendum has made on engineering has been shown by Markit, a company that covers global market trends. As the referendum's results were unveiled at the end of June, the construction Purchasing Managers' Index fell to 46.0. To indicate how significant this is, one needs to consider that Britain's index sat at 51.2 in May. The numbers are now the lowest they have been since 2009, which were as low as they were due to the recession.
"This is an absolutely dire survey that fuels serious concern over the construction sector...and can only intensify concern as to just how much the construction sector will be hampered by the Brexit vote," said chief UK economist at IHS Global Insight, Howard Archer.
Tim Moore, economist at Markit, speaking to Bloomberg, said: "Construction firms are at the sharp end of domestic economic uncertainty and jolts to investor sentiment, so trading conditions were always going to be challenging in the run-up to the EU referendum, However, the extent and speed of the downturn in the face of political and economic uncertainty is a clear warning flag for the wider post-Brexit economic outlook.”
Commercial building and home building was the hardest hit, however, civil engineering seemed to be stable. Markit said it was the first instance since April 2013 that the index had fallen below a 50 level. Companies want to stay above 50, due to 50 being the level that divides "contraction from expansion."
We've also recently reported that Britain's energy policy might also be damaged by the Brexit, however, no solid facts will be available until a new Prime Minister is appointed.
Markit points out that construction makes up 6 percent of Britain's economy. However, manufacturing in the country is said to be undamaged by the Brexit vote, as far as the preliminary investigations can see.
"The vast majority of June's survey responses were received ahead of the EU referendum, so the worry is that the ensuing political turmoil will hit construction spending decisions for some time to come," Moore concluded.
So, more woes for Britain as leadership falls away and uncertainty spreads. The question is, is engineering completely doomed in the country? We'll keep our eye on the situation and provide the cold, hard evidence as it is presented to the people of Britain in one of the most controversial political moves of all time.
