How will Brexit Affect the UK Events Industry?
At times, it seems like the debate around the EU Referendum has been going on forever. With spurious claims coming from both sides, it’s become hard to tell fact from fiction. Perhaps we shouldn’t be surprised by the level of hyperbole and vitriol we’re witnessing though, given the huge implications Brexit could have for our country.
In this article I want to turn our attention from the wider national debate to look at how the events industry has been reacting to the upcoming EU Referendum and how a vote to leave could affect the UK events industry. As inevitably divisive and opinionated as the debate over our membership of the European Union is, I will aim to give a rounded account, before going onto look at some of the potential areas of impact on the events industry.
I will end the article by laying out my own opinion on the question of our EU membership.
Where does the Event Industry Stand?
According to a C&IT snap poll of just over 40 event planners conducted in February of this year 73% of industry planners oppose Brexit. That’s a pretty conclusive result but it is far from a conclusive reading of the entire UK events industry’s position.
Another poll, this time conducted by the Business Visits & Events Partnership (BVEP) published in May, found 60% of its organisation’s members believed the UK would attract fewer events if it left the EU. Interestingly, the same survey found that many respondents were concerned over the level of regulation the EU imposed on events held in Europe but 44% believed a Brexit would lead to less.
There was also huge concern that the UK could become seen as ‘an outsider’ destination for European companies looking to hold events. Tellingly only 10% of respondents thought more businesses would be attracted to the UK in the event of Brexit, with 60% thinking it would lead to less. On the investment front, just 13% predicted an increase with 50% thinking it would drop.
Looking beyond the events industry itself to the tech sector, which makes up the majority of our client base here at Outsourced Events, we see the remain voice is even stronger, with a recent poll finding 70% of tech companies surveyed wanting to stay, with 15% supporting leave and 15% undecided.
Like a lot of other industries reliant on international investment and trade, the events industry is erring on the side of remain. This could be for a number of economic reasons but primarily it seems to be driven by uncertainty and a desire not to upset the status quo. Vice-chair at the Business Visits & Events Partnership (BVEP), Simon Hughes is just one leading figure in the events industry who is frustrated with the level of debate. “We don’t really know what the impact will be if we leave the EU and I don’t believe people have enough facts to make an informed decision,” he says.
Perhaps the reason such spurious claims are being made by politicians on both sides of the debate is because it’s extremely difficult to extrapolate what will actually happen with any degree of certainty in the case of a vote to leave. This is an unprecedented situation and as the 2008 financial crisis has showed us, economic predictions can be very unreliable.
I want to turn our attentions now to three areas of impact that a Brexit vote could have on the UK events industry, starting with the inevitable issue of uncertainty.
The Uncertainty Impact
We all know that uncertainty is a bad thing for markets as it leads to instability, which in turn can lead to falling share prices and a falling pound. Whilst a weakened Sterling does have its upsides for export businesses overall it’s a gloomy picture economically. That isn’t to say that the instability from a Brexit vote will be permanent but a period of economic instability is inevitable if we vote to leave the EU.
The perceived lack of clarity from pro-Brexit campaigners around what a future trade deal with the EU would look like has also added to this uncertainty. The remain side counters this assertion by insisting that any period of instability will be short lived and pale into insignificance when compared to the longer economic view.
The Economic Impact
One of the overriding economic concerns for the UK events industry is that a vote to leave the European Union will result in major businesses moving their headquarters out of London, which would make it harder for events agencies to pitch for business.
Business Visits & Events Board chair, Nick de Bois is quick to play down the negative economic impact of a Brexit vote. “The events sector is no different to other businesses in that they can, and many do, thrive outside the EU, which has fast become an un-competitive trading block that does not suit the entrepreneurial spirit of Britain’s businesses of the future.”
Simon Hughes of BVEP, a prominent events industry voice on the remain side, points out the impact on travel of a Brexit vote and what this could do to the attractiveness of the UK as an event destination. “If we left the EU, I feel those challenges would remain and create further barriers. It could make the UK a more expensive place to visit.”
The Workforce Factor
One of the most potent and also toxic issues at the heart of the EU debate is the issue of unchecked immigration from other EU countries. Although it’s not clear what rules would be imposed on limiting EU workers in the UK, the implications for the UK events industry on the restriction of free movement of EU workers could be huge in the event of a vote to leave.
“All venues rely on transient staff, particularly from the EU,” points out Will Poole, events and compliance manager at Troxy, who sees a Brexit vote leading to a diminishing talent pool and rising costs.
Politics and Pragmatism
I think it’s worth pointing out at this point how the tension between politics and pragmatism are the driving force at the heart of this debate. It’s hard to digest facts when the EU question, in which we all get a say, goes to the heart of many people’s political convictions and their notion of British sovereignty and independence. That this debate crosses the party political divide is also clear, as the huge rift it has caused in the Conservative party has shown us. Divisions amongst Labour are less severe and fractious but are still there.
Although the level of contentious and tenuous claim and counter claim hasn’t exactly helped people digest the facts, for many voters gut feeling will trump any dispassionate rational assimilation of the facts. That being said the level of debate has been lamentable and it’s clear that many people still haven’t made up their minds and are fed up with the lack of clarity.
I wanted to end this article by clarifying my own position which is for Britain to remain in the EU. Although this stance is a personal one, I do believe it is one shared by many of my colleagues at Outsourced Events. The EU is far from a perfect institution but voting to leave it will not set us free from the shackles of Brussels regulation as so many Brexiteers insist. Indeed, we will be as tied to the principle of the free movement of EU citizens if we wish to continue to trade in the Common Market. To conceive of us not being in the Common Market carries with it so much uncertainty that it just seems too hard to contemplate.
I believe any future for the UK outside of the world’s largest trading block would not be a rosy one for the events industry. I think Rick Stainton, MD of Smyle, puts it best.”The UK events industry has huge interdependence on the EU in terms of trade, travel and talent – is it worth trying to unravel that for a possible but unqualified longer-term gain?”
I cannot see how leaving an organisation that creates a common interest and common market between nations is beneficial to an industry that relies on international travel, networks and investment. Clearly the EU has gone through a series of crises over the last few years and is far from perfect. But does that mean we should abandon it when the going gets tough? I don’t think so.