Brexit labour market shock

Post-Brexit immigration curbs will result in a “labour market supply shock” and lead to higher automation and job offshoring rather than higher wages for British workers.

The report from Deutsche Bank warned there is little to support the “familiar Brexit narrative” that a drop in immigration will force companies to “pay-up” for domestic workers, particularly in low-skilled industries.

Deutsche Bank macro strategist Oliver Harvey and chief economist Mark Wall, said: “Wages cannot be raised sustainably above productivity without higher inflation. Otherwise, the labour costs of businesses will rise at the expense of profits.”

The report also predicted the UK is set for an automation boom.

The UK is set for a boom in the use of robots in the economy.