Men with few qualifications at most risk from barriers to trade with EU after Brexit

Car manufacturing - Image credit: Press Association

Men with few qualifications are most at risk from trade barriers Brexit, new research from the Institute for Fiscal Studies (IFS) has found.

The IFS report suggests that men with only GCSEs or less who are employed in manual occupations are at particular risk from barriers to trade with the EU, such as tariffs or customs checks.

Researchers analysed which industries, regions and types of workers would be most and least affected by different Brexit scenarios.

It found that nearly 20 per cent of men with low levels of formal qualifications work in industries that are very highly exposed to increased trade barriers with the EU.

That compares with 15 per cent of highly educated men and less than 10 per cent of highly educated women.

Overall, 14 per cent of workers – or 3.7 million people – are employed in industries that the IFS classifies as very highly exposed – which it estimates would lose more than five per cent of their GVA if trade with the EU was on World Trade Organisation rules.

Manufacturing industries such as clothing and cars and the chemicals and pharmaceuticals sector, which sell a large fraction of their output to the EU, are at particular risk from higher trade barriers, it says.

The transport equipment sector is particularly at risk because it also imports a quarter of its materials, meaning its import costs would also rise.

Finance is the most exposed services industry, as it currently exports a 12 per cent of its output to the EU.

Some industries such as agriculture could benefit from trade barriers if consumers substitute away from more expensive imports from the EU towards products made in the UK.

However, the IFS suggest that industries that could benefit make up only a small share of employment and the overall economy, and the benefits would also come at the expense of consumers facing higher prices.

Agnes Norris Keiller, a co-author of the report and a Research Economist at IFS, said: “If barriers to trade with the EU increase, particularly the sort of ‘non-tariff’ barriers created by customs checks and regulatory divergence, then some sectors of the economy will be affected more than others.

“Parts of the manufacturing sector are likely to be hardest hit.

“As a result, the jobs or wages of men with low formal qualifications working in certain manual occupations may be under particular threat.

“These are the sorts of workers who are most likely to find it hard to adapt and to find new roles that are equally well paid elsewhere.

“Conversely, the UK agriculture industry could gain from trade barriers as households switch from demanding EU food products to ones made in the UK.

“But these gains would be at the expense of UK consumers, and these industries are a small proportion of overall employment.”