What really splits post-Brexit Britain

by Michael Dowsett

It’s become commonplace since the EU referendum to say the UK is now split between Leave and Remainers rather than the traditional left/right party political choice.

The Labour Party has become the favoured test-case for a potential Brexit re-alignment, with the much-discussed cultural split between the Party’s ‘Hull’ and ‘Hampstead’ wings generating many column inches, and about to be tested at the ballot box in by-elections in Stoke-on-Trent and Copeland.

While this analysis seems appealing, particularly given the short time since the EU referendum, it is certainly not pre-ordained that the coming period in British politics will be defined by cultural, rather than economic issues.

One reason for this is the dramatic impact which a new wave of automation is set to have on the UK labour market in the next 15-20 years.

Recent research by Carl Frey, co-director of Oxford University’s Oxford Martin programme on technology and employment, has shown that significant numbers of middle-class jobs paying over £40,000 per year are at risk from automation. Loan officers, credit analysts and real estate brokers may want to look away now.

Whilst these trends may well help the UK economy, notably by way of a kick up the backside of our lagging level of productivity, the political implications of the next wave of automation could be profound.

Fewer white-collar jobs may require more generous and universal welfare provision. Some Labour figures are already re-considering how a guaranteed minimum income may be needed to provide an economic cushion for those whose jobs are replaced by machines.

And growing economic insecurity in the UK could even lead to increasing popularity for the radical left; look what happened in Greece.

However, the economic and social opportunities arising from this labour market upheaval should not be ignored. Automation could eliminate wage differentials between developed and developing economies, leading to substantial ‘re-shoring’ of manufacturing activity.

The decline in the need for commercial office space could create more land for affordable housing, particularly in urban areas. A boost in economic activity could provide the tax revenue to pay down the high levels of post-crash public debt in the West and help fund the rising pension and healthcare costs associated with an ageing population.

Finally, freeing people from work commitments could enable them to spend more time with their families, helping address the ‘loneliness epidemic’ and ease the rising cost of social care on the taxpayer. Far from being a boon to insurgents, a Government able to take advantage of any of these trends would be well-placed to reap significant political rewards.

The UK’s departure from the EU is set to dominate the political discussion, but it’s a safe bet that Brexit cultural changes will only be part of a more widespread upheaval.  Chances are our future will still be dominated by the economy (and the place of humans within it), stupid.