How Could Britain Exiting the EU Affect the Fashion Industry?
Author: Anton Dell
With debate over whether the UK should leave the EU reaching fever pitch, we are forced to ask ourselves what impact a Brexit would have on the fashion industry. The general consensus from industry insiders is that such a drastic shift would lead to a damaging climate of insecurity.
Luxury brands including Burberry, Amanda Wakeley, and Belstaff have publicly sided with the Remain campaign and Vogue editor-in-chief Alexandra Shulman, legendary designer Vivienne Westwood, and Naga Partners founder Fabrizio Zappaterra are among those in the industry who have signed a petition in support of Britain’s continued membership of the EU.
Financial analysts have reported that a Brexit would likely lower the value of an already weakened pound and Chancellor George Osborne has warned that the move could plunge Britain back into a recession. A flagging currency would impact the buying power of British consumers and consequently prove a blow to retailers both at home and abroad. Such economic turmoil could only exacerbate consumer uncertainty.
And let’s not forget that the EU currently opens up the door to 500 million consumers living within the single market: a driving force for British retailers, and therefore an important safeguard for British jobs. Britain’s inclusion in the EU also helps to attract overseas firms keen to share in a slice of the European market.
What is more, should the electorate vote in favour of leaving, the industry will once again be forced to pay EU tariffs on imports and exports. While the overall percentage of exports going to the EU has fallen since Britain became part of the European Economic Community in 1973, fashion exports have grown substantially in the past five years from £4.5billion to £5.8billion. With an increase in trade restrictions, fashion brands would likely reconsider establishing headquarters or creative departments in this country.
Also worth considering is how a Brexit would impact the workforce of the UK fashion industry. The free movement of employees from fellow member states has, up until now, nurtured a diverse and ever-evolving industry. Loss of this freedom would prevent young European creative talent from choosing a career in fashion based in the UK. Additionally, lower-skilled workers - who make up the bulk of the industry - would be in short supply.
Indeed, so divisive is the prospect of a Brexit that even the debate itself is proving a turn-off for consumers. Canadian fashion designer Erdem has reported a 1% decrease in visitors to the brand’s e-commerce sites since tensions over the referendum have reached a peak.
It would seem that Britain exiting the EU would only hinder development of the retail sector in the UK by at once destabilising markets and consumers and imposing further restrictions on an industry that thrives on freedom of movement and creative exchange.