Nine months after the United Kingdom voted to leave the European Union, mere days after the economic and political union’s 60th birthday, British Prime Minister Theresa May has signed the letter to trigger Article 50, more commonly known as Brexit. Now we enter two years of utter uncertainty before some sort of break-up — though no one knows to what degree — officially happens between the UK and the EU.
While until Wednesday no official change had occurred, Brexit has already affected the British, European, and, by extension, global business markets.
One area that is really raising eyebrows is the tech community on both sides of the Channel. According to many sources, the UK tech sector, akin to progressive Silicon Valley, was overwhelmingly in favor of Remain. But since In is out, what will they do? Today we attempt to answer that.
Brexit Is Already Making It Harder to Recruit Developer Talent
One of the main negotiations, which would need to be a new bilateral trade agreement between the UK and EU, would probably mean that, in exchange for UK being able to opt out of freedom of movement, it would have to give up "passporting rights." This will hurt the European financial capital of London but it will hurt any company that wants to provide cross-border services or have a branch on either sides of the Channel.
"But it would also be especially bad for Britain's technology sector, which relies on immigration to fill the hole left by years of underinvestment in technical education in the UK," wrote The Guardian's Alex Hern.
In the developer space, experience and programming languages can make it challenging to find the right candidates. This is why tech startups tend to be very international — being able to work and live anywhere means being able to hire the best talent. Since the crisis began, qualified developers with no job prospects in Southern European countries like Spain — where unemployment is greater than 20 percent and more than double that for youths — flock to the UK, where unemployment remains under five percent.
With it unclear if EU residents will be able to live and work in the UK, that talent pool is shrinking. More than half the more than 1,200 tech startup respondents to a post-Brexit survey thought that it is already becoming "difficult to attract and retain the very best talent."
And then those startups that already have non-British EU staff — at least in London, just about all of them — are fretting over losing that talent.
As soon as the Article 50 bomb is dropped, tech companies especially will look to move to somewhere that's guaranteed to be in the single market. Amsterdam, Barcelona and Berlin are at the top of lists where the next European tech hub and fintech hub may reside, each of these cities with significantly lower costs of living.