'It's impossible to prepare': Brexit delay fuels further confusion in UK tech industry

A new 'Brextension' delays the UK leaving the European Union until October. But the continued uncertainty around Brexit is leaving many in the technology industry confused, frustrated - and losing out on business.
Written by Danny Palmer, Senior Writer

Brexit has been delayed again and the United Kingdom is now set to remain a member of the European Union until 31 October – but with the option to leave earlier if Prime Minister Theresa May can finally secure support for her withdrawal deal.

In the short-term, the 'Brextension' prevents the UK from defaulting to leaving the EU with no deal on Friday 12 April, avoiding the damaging prospect of the UK leaving without a transition period to decide on its future relationship with the EU.

It's also the second-time Brexit has been delayed, as the UK was initially supposed to depart on 29 March – exactly two years after the government invoked Article 50, stating the intention to leave.

In the months since, organisations in the UK technology industry have been attempting to prepare for a situation which, for many, remains unclear.

While some are thankful for more time to prepare for various different Brexit scenarios, others remain confused about what's going on and what the potential of a deal, no deal – or even No Brexit – might mean for business going forward.

"It's impossible to prepare for any scenario, as the government haven't provided any clarity on the consequences of each situation. UK businesses want and need certainty to be able to make preparations and business decisions on essentials such as people and machinery," says Dean Sadler, CEO of Tribepad, a recruitment software provider.

"The UK business scene is strong, and with enough information we will be able to weather any storm that Brexit may bring, but we need to at least know whether we need to prepare for a light shower or a tsunami."

The UK's technology industry is held in high regard, with British artificial intelligence and cyber security often listed as world leaders in their fields.

But there are fears that the uncertainty around Brexit jeopardises this – especially as European rivals look to capitalise on the situation by boosting investment from technology companies and even encouraging companies to relocate to the continent.

"It remains a huge concern that the UK may lose its position as Europe's leading hub for technology talent post-Brexit," says Robbie Clutton, head of EMEA for software services firm Pivotal Labs.

"With software developer talent in Britain predicted to decrease post-Brexit, and a majority of CIOs looking at staffing outside the UK to assist in the development and deployment of software post-Brexit, much uncertainty still surrounds the future of innovation in the UK."

Access to staff with specialised skills is already a worry for many companies in the technology industry and there are fears that a Brexit deal which does away with freedom of movement will make this even more difficult – and therefore make it more of a challenge to stay competitive.

However, for some, the new Halloween Brexit deadline offers the option to explore new opportunities in the six months leading up to 31 October, especially around recruitment.

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"If we learn anything from Brexit, it should be to cast the net wider in the UK technology talent pool, and reach as-yet untapped talent elsewhere in the UK," says Jonquil Hackenberg, head of C-Suite advisory at Infosys Consulting.

"The upside of this Brexit delay is that it is forcing tech businesses to consider these options – improving diversity, creating opportunities to upskill staff, and investing in their business' future. With innovation stalling, bolstering talent and resources will be fundamental to surviving the Brexit storm," she adds.

But while organisations can look for talent in other regions of the UK, establishing new business is a different matter entirely, with the repeated delays causing some organisations to put off projects because of the uncertainty – and that's hitting the revenues of technology suppliers.

"Adoption in the UK has undoubtedly been affected by Brexit," says Dr. Simon Kampa, CEO and founder of Senseye, a predictive maintenance analytics provider.

"We're talking to several major manufacturers here that would like to trial Senseye but are unwilling to commit to new innovation projects without more certainty around their European supply chains and export outlook."

And this is far from the only example of Brexit having an impact in this way.

"Brexit is fuelling uncertainty and as a result many businesses are hitting the pause button. The extensions being given are short enough that organisations are keen to hold back on making any tech changes until they have a clearer picture of what's happening," says Zoe Cunningham, managing director of software development firm Softwire.

However, if organisations don't attempt to plan for what might – or might not – happen, they could find themselves worse off than before.

"This is dangerous however, as the expectations of consumers and other businesses don't stop evolving, and could mean a tech organisation loses its foothold simply by standing still," she adds.

"With this in mind, a Brexit delay is proving worse that a swift conclusion either way, and it's those who are brave enough to move forward in these times that will be in the strongest position."

This is far from the first time the UK technology industry has voiced concerns about how the government is approaching Brexit and how it will impact on them.

For now at least, Brexit isn't a concern which needs to be resolved in the immediate future – but all organisations would do well to figure out where they stand so they can be prepared for if and when the UK finally does leave the European Union, because October isn't that far away.

"The extension agreed by the European Council means that digital businesses no longer have to brace for an imminent no deal Brexit. However, for tech firms who have already had to spend millions of pounds and thousands of working hours preparing for Brexit, an October extension is not long enough to reduce the need for No Deal stockpiling or increase investor confidence," says Julian David, CEO of UK tech industry trade association techUK.

"The best way to lift uncertainty continues to be Parliament finding a suitable solution to the Brexit impasse," he continues, adding  "Anything other than finding a way through the current mess will simply ensure that both politicians and business leaders are unable to refocus on the issues that truly matter to supporting the rapidly growing firms of the future."  


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