Nearly 90% of chief financial officers feel their business faces abnormally high levels of uncertainty, according to survey

Confidence among chief financial officers at large British companies has only partially recovered from a post-referendum plunge and more than half expect to cut investment and hiring over the coming year, as they fret about the long-term consequences of Brexit.

A poll taken three months after the vote to leave the EU shows that 88% of finance officers feel their business is facing abnormally high levels of uncertainty. In the immediate aftermath of the EU referendum on 23 June, the figure was 92%. The survey by consultants Deloitte also shows that risk aversion remains high.

The publication of the poll on Monday comes as concern among businesses grows that the government has set a course for a hard Brexit deal, which would leave the UK shut out of the single market and with limited access to skilled workers from overseas. Fears as to the implications for trade, inward investment and Britain’s standing in global markets have knocked the pound to new 31-year lows against the dollar.

Against this febrile market backdrop, business leaders wrote to the prime minister, Theresa May, warning that a hard Brexit would cause such grievous damage that it should immediately be ruled out as an option.

The government will come under further pressure on Monday as the British Chambers of Commerce urges ministers to restore confidence among businesses as the starting date for Brexit negotiations approaches.

At the Conservative party conference last week, May said she will trigger article 50 by the end of March 2017, setting in motion the two-year process of leaving the EU. Publishing a survey showing a cautious mood among businesses, the BCC said guidance on the timing of negotiations went only some of the way to helping jittery employers as they make hiring and spending plans.

“Boosting business must be a key task for government in the months ahead,” said the BCC’s acting director general, Adam Marshall.

“The prime minister has given businesses some clarity on the timetable for article 50 and on short-term regulatory and legal issues. This is helpful, but needs to be followed up by a firm demonstration that the government has a clear and coherent strategy to defend the UK’s economic and business interests in the negotiations that lie ahead.”



The BCC’s survey of more than 7,000 companies suggested that they had lowered their expectations for hiring, turnover, and investment in plants, machinery and training.

The survey results suggested that the economy had avoided a downturn for now and was still growing, albeit at a slower pace than before the referendum, the BCC said.

This conclusion echoes other indications that consumers continued to spend and business activity held up over the summer, despite warnings before the referendum that a leave vote could cause a recession.

There were also signs of a modest recovery from the initial referendum shock in the Deloitte poll of 124 finance officers. In the days after the Brexit vote, 73% of respondents said they had become gloomier about their company’s prospects. Asked again in September, 47% said they were gloomier than three months earlier, 37% said they felt the same and 16% were more optimistic.

The pattern of gloom easing, but remaining widespread, was repeated across other measures. The proportion of finance officers saying now was a bad time to take on risk fell from 95% to 82%. Those planning to cut capital spending in the next 12 months fell from 82% to 58%, with 51% saying hiring would slow, down from 83% in the aftermath of the Brexit vote.



Ian Stewart, the chief economist at Deloitte, said: “Since our last survey, we’ve seen the appointment of a new prime minister, a strong rally in equity markets and a solid run of UK economic data.

“But chief financial officers continue to see significant risks in the economic environment and perceptions of uncertainty remain elevated.”



Much of the concern over the economic impact of leaving the EU has focused on Britain’s financial sector, a major source of jobs and tax revenue. There are worries that a hard Brexit could push banks to look to cities such as Frankfurt and Dublin as new European bases.

Over the weekend, Goldman Sachs played down speculation that it was looking to move a significant proportion of jobs to rival European cities if Britain loses preferential access to the single market.

Responding to a report in the Sunday Times saying the US bank was preparing to take nearly 2,000 staff out of London in the event of a hard Brexit, a spokesman said: “We continue to work through all possible implications of the Brexit vote.

“There remain numerous uncertainties as to what the Brexit negotiations will yield in terms of an operating framework for the banking industry. As a result, we have not taken any decisions as to what our eventual response will be, despite media speculation to the contrary.”