Law Society warns of £3bn loss from legal sector after Brexit
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Growth in the legal sector could be halved if Britain leaves the EU without a deal, says the Law Society as it releases economic forecasts in collaboration with Thomas Reuters to predict alternative Brexit scenarios.
Law Society president Christina Blacklaws said: “UK legal services look to have been relatively buoyant through 2017-18, thanks to a combination of Brexit-related work, steady demand from UK businesses and an uptick in business from non-UK clients taking advantage of the depreciation of the pound.”
“However, Brexit is likely to have a significant negative effect on the legal sector in the medium and longer term. This is largely due to the knock-on impact of Brexit on the wider economy as demand for legal services relies on the success of other sectors of the UK economy.”
The econometric model, based on forecasts from the National Institute of Economic and Social Research and the IMF World Economic Outlook and data from the Office for National Statistics, predicts a 2.2% average annual growth from 2019 to 2025 with a soft Brexit, dropping to 1.5% with harder Brexit options. It predicts growth of only 1.1% per year if the UK has to fall back on World Trade Organisation rules in a ‘no deal’ scenario.
Employment in the sector is also expected to be affected, with a hard Brexit leading to lower growth, less investment in UK firms and overall lower productivity growth.