Middle market businesses across the North East are becoming increasingly alarmed at the prospect of a no deal Brexit, according to a new survey by audit, tax and consulting firm RSM.
Almost half (46 per cent) of middle market businesses surveyed by YouGov no deal would be either harmful or catastrophic to their business, a 21 per cent rise over the previous quarter and the highest level in the UK.
A sort of paralysis seems to have set in as everyone just waits to see what actually happens.Steve Railton
Less than a third said no deal outcome would be favourable or advantageous, although this was slightly up.
Overall, regional business sentiment about the impact of Brexit over the next two years dropped to its lowest quarterly level since RSM started the survey in 2017.
When asked about actions taken to prepare for a no deal Brexit, the most common actions taken included increasing prices (21 per cent), adjusting supply chains (20 per cent) and setting aside contingency funds (20 per cent). However, firms reported taking fewer actions to prepare than in the previous quarter.
RSM’s Steve Railton said: “Not surprisingly middle market businesses in the region are becoming increasingly concerned with the uncertainty surrounding Brexit and the prospects of a no deal departure on March 29.
“What is also apparent is the shift from optimism this time last year to an increasingly more pessimistic viewpoint, although longer term sentiment remains positive.
“Despite the views in the survey, the closer we potentially get to Brexit, the region’s business leaders appear to be taking fewer steps to prepare. A sort of paralysis seems to have set in as everyone just waits to see what actually happens.”