A decade ago today, on June 23, 2016, 52% of British voters voted to leave the European Union. It was a hugely consequential moment for Britain’s economy and political scene, ushering in one of the most turbulent decades in the country’s recent history.
Keir Starmer announced this on Monday resign As prime minister after two years in office – something that may seem short for the leaders of some countries, but for the UK is one of the longer terms in office in recent years. Nominations for a successor will open next month and the next party leader is expected to be chosen soon. Then Starmer’s resignation marks the end of a chaotic period of political whiplash that saw his Labor party suffer devastating losses in last month’s local elections.
Starmer’s resignation paves the way to the prime ministership for Andy Burnham, the former mayor of Greater Manchester. If Labor elects him, Burnham would be Britain’s seventh prime minister to serve for 10 years since Britain voted on the country’s new course.
The years since have been a period of volatility unparalleled in Britain’s recent political history, exacerbated by economic malaise and profound societal changes that are likely to have repercussions well into the next decade and beyond.
With Starmer’s announcement, the outgoing prime minister ensured a suitably turbulent end to a chaotic decade that began with similar political upheaval.
Since the referendum, six prime ministers have taken office at 10 Downing Street, none of whom have lasted long enough to bury the political instability caused by Brexit.
David Cameron, who described the Brexit campaign as an act of “economic self-harm” and fought relentlessly against it, was forced to resign from office the morning after his defeat. Theresa May then spent three years in office and tried to pass a Brexit deal, but failed That didn’t make anyone happyand was ultimately rejected by the House of Commons, marking the greatest defeat of a sitting government in the country’s modern history.
Boris Johnson entered the election campaign with a clear promise: “achieve Brexit.” His supporters rewarded him with a landslide victory and then kept their mouths shut as the Conservative leader bowed to bitter calls for his resignation in the wake of the Partygate scandal after three years in office. His successor, Liz Truss, remained in office for 49 days – a memorable term endures from a supermarket salad. Rishi Sunak stabilized the situation just long enough to lead the Conservatives. worst election defeat in parliamentary history and will have to give way to Starmer in 2024.
And now Starmer himself is less than two years away from a five-year term, his Labor government undone by a local election defeat and a right-wing populist rise that has upended the country’s two-party map.
Each exit has been fraught with its own cocktail of political poison: failed attempts to push through Brexit, scandals, economic headwinds or landslide defeats. The last decade has hardly put British politics on a more stable footing compared to the day the British voted to leave. While voters may have become accustomed to the revolving door at Downing Street, the economic impact of the country’s volatility is only beginning to be revealed.
While the heads of state and government changed in Westminster, the decline in Great Britain’s population accelerated and could hardly be reversed.
In April the Office for National Statistics (ONS) published its current population forecastswhich predicts a demographic turning point between 2025 and 2026. According to the ONS, last year was the last time the number of births in the country exceeded the number of deaths. At some point in mid-2026, the number of deaths will exceed the number of births, and this will continue to be the case for the foreseeable future. As there is not enough immigration to offset the decline in natural births, the UK will face some population decline in the not too distant future.
Between 2024 and 2034, the ONS forecasts 6.4 million births and 6.85 million deaths – a natural deficit of around 450,000 people over the next decade or so. From 2026 onwards, net immigration will be the only thing keeping population growth going at all, and even that is no longer a certainty. The latest ONS forecasts predict the UK’s population will grow by 1.7 million people by 2034, almost half the increase estimated last year, largely due to falling net migration.
“Our latest forecasts point to slower population growth than previously forecast”
James Robards, head of population forecasting at the ONS, said in Statements reported by the Guardian. “This is primarily due to lower migration assumptions – reflecting the recent sharp decline in net migration – and lower fertility assumptions.”
Other countries face a similar demographic cliff, including the United States, where population growth has increased slowed down recently due to falling birth rates and declining net migration. In the UK like in the USAThe population is expected to peak in the mid-2050s before declining.
But the economic consequences will be felt much earlier. The number of Britons of retirement age is expected to rise by 1.8 million over the next decade, even as the number of children falls by 1.6 million, shrinking the future tax base needed to fund a larger pension and healthcare bill.
It is a budget impasse for which there is no easy political solution, regardless of who is in Downing Street.
While demographic development progresses slowly and is largely independent of the referendum, this is not the case with economic development. The decision to leave the EU and rewrite several volumes of trade and industrial policy has taken a significant toll on the UK economy, according to one Working paper released last week by the National Bureau of Economic Research.
Over the past decade, Brexit has cost the British economy between 6% and 8% of its GDP, the authors found, based on an analysis of Bank of England data. During these ten years, investments fell by 12 to 13 percent, employment fell by 3 to 4 percent and productivity also fell by 3 to 4 percent.
These losses have worsened over time and are directly linked to the political instability that has plagued the UK since the vote. The authors estimated that about half of the GDP loss was due to years of increased political uncertainty. Brexit was a source of unease that companies listed as one of their top three concerns for almost five years after the vote. However, it eased somewhat in 2021 as a new EU trade agreement came into force. The rest of the lost growth was due to higher costs caused by more cumbersome trade restrictions.
Ten years to the day since that historic vote, Number 10’s steps have become increasingly well-trodden as the UK struggles with an aging population and an economy smaller than it otherwise would have been. The vote may have taken place on a single day, but the calculation still worked out.