UK business responds to news that Boris Johnson is to become next Prime Minister

23 July 2019

Boris Johnson new Conservative Party leader & new UK PM Jul19

As frontrunner, Boris Johnson was confirmed as the winner of the Conservative Party leadership race, replacing Theresa May to become the next UK Prime Minister, business & industry reacts with cautious optimism.

The CBI, the voice of business, which just published its latest Industrial Trends survey with data showing that UK manufacturing is facing its biggest slowdown since the financial crisis, offered its congratulations, while also referring back to its just released new business manifesto for Government.

Carolyn Fairbairn, CBI Director-General, said: “Many congratulations to Boris Johnson. British business shares your optimism for the UK. Let’s work together to get our economy back on track and working for communities everywhere.

“Business needs three things in the first 100 days. A Brexit deal that unlocks confidence; clear signals the UK is open for business; and a truly pro-enterprise vision for our country.

“On Brexit, the new Prime Minister must not underestimate the benefits of a good deal. It will unlock new investment and confidence in factories and boardrooms across the country. Business will back you across Europe to help get there.

“Early signals back home also matter. From a new immigration system to green-lighting major infrastructure, there is no time to waste.”

Stephen Phipson CBE, CEO of the Manufacturer's Organisation, Make UK, which has consistently warned of the dangers of a no deal Brexit on behalf of its members, said: “Congratulations to Boris Johnson on winning the Conservative leadership contest. We look forward to working with Boris and his team championing UK manufacturing.”

The UK chemical & pharmaceutical manufacturing industry adds £18 billion of value (£9 billion from chemical and £9 billion from pharmaceutical) to the UK economy every year, from total annual turnover of £50 billion. In addition, the sector also contributes to the UK economy in its position at the head of many supply chains within manufacturing, and its employment of a well-remunerated, high-skilled workforce, supporting 500,000 jobs both directly and indirectly.

The wider chemical & pharmaceutical sector (manufacturing plus distribution) is the largest exporter of manufactured goods in the UK, with annual exports of over £50 billion. Automotive is the sector with next highest exports of £35 billion; aerospace is £32 billion. 63% of companies in the sector export, the highest proportion of any goods manufacturing sector in the UK economy. 60% of exports go to the European Union, and 75% of imports and raw materials come from the European Union.

The sector’s level of business investment is £4.3 billion, compared to automotive £2.7 billion and aerospace £2.1 billion, while expenditure on research & development is £5.0 billion (automotive £2.7 billion and aerospace £2.1 billion). The products and technologies of the chemical industry are essential parts of medicines, food & drink, telecommunications, electronics, energy-saving, IT, clothing and more.

The Chemical Industries Association said: “We congratulate Boris Johnson and stand ready as the country’s biggest manufacturing export sector to work with the new Prime Minister and his Government to deliver growth and prosperity across all of the UK.
 
“Securing a Brexit deal with the European Union in the coming months will, we believe, fundamentally strengthen the chances of that growth and prosperity happening, so we urge the new Prime Minister and his government – along with EU27 governments – to work constructively and urgently to avoid a no deal outcome by the end of October. Frictionless tariff free trade, regulatory consistency and access to skilled people remain the chemical industry’s priorities right across Europe and delivering those outcomes will help remove the damaging climate of uncertainty and inject some much needed business confidence in terms of trade and investment. 
 
“Government working with business can deliver a bright future for all”. 

Samantha Hurley, Director of Operations at recruitment trade body, the Association of Professional Staffing Companies (APSCo), cautioned: “Johnson’s appointment will be no great surprise to the majority of our members. However, the new Prime Minister’s ‘do or die’ commitment to delivering Brexit by the 31st October 2019 means that there will be a certain level of apprehension around how this could potentially impact business – particularly as the former Foreign Secretary has, so far, failed to rule out a no-deal exit.

“While the professional recruitment market may not be as exposed to the same potential post-Brexit risks as those recruiting for lower skilled roles, it is crucial that future strategy remains focused on attracting the talent our country needs. With this in mind, we welcome Johnson’s position that the electorate has voted to control, rather than reduce, migration, and that an ‘Australian style’ points system could make the economy ‘much more open’ to skilled migrants.

“The new PM’s suggestion that the economy would be stimulated through cuts to corporation tax – and his openness to exploring the possibility of allowing businesses to offset new capital investment – is also likely to be favoured by our members.

“Many will also welcome Johnson’s commitment to boosting funding for technical and vocational apprenticeships. Our members report chronic skills shortages in sectors such as engineering, and developing talent in this area will create a highly-skilled workforce to meet demand for high-wage jobs.

“Ultimately, it is our hope that Boris Johnson will be determined to put the interests of the UK economy ahead of his personal ambitions, so that the professional recruitment community can leave this period of uncertainty behind and concentrate on growing their businesses in a more stable climate.”


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