‘Brexit’ disruption unclear, unwelcome for AEC

After Lord Cornwallis had surrendered to Gen. Washington at Yorktown VA in 1781, the British band famously played The World Turned Upside Down as it exited past the victorious Colonials.

This morning, in the wake of Great Britain’s momentous popular vote to exit the European Union (EU), approved narrowly but decisively via referendum yesterday, financial markets from Wall Street to Tokyo are reeling from the unexpected news. British PM David Cameron, who had campaigned vigorously for the UK to remain in the EU — a vote ironically that he had personally initiated months ago — already has announced that he will step down in three months, in effect reading the poll results as a national vote of “no confidence.” Voters in the City of London had voted overwhelmingly to remain in the EU, which was the clear preference of most business leaders, as well. But other precincts ultimately won out.

For some sense of Europe’s stunned, even panicked reaction to this news, from Paris and Brussels to Rome and Berlin, and beyond, just close your eyes and picture a certain flamboyant real estate tycoon and reality show star being elected as the 45th President of the United States next November…

…Pause…

Of course, 2016 already had meant historic disruption for architects, engineers and contractors in the UK, what with this spring’s nationwide mandate for the use of building information modeling (BIM) on all government projects. But that earthquake was years in the making, so AEC firms had plenty of time to prepare for the new normal that arrived earlier this year. Britain’s exit (aka “Brexit”) from the EU, however, was an outcome for which few in any industry were prepared.

This morning, Jane Duncan, president of the Royal Institute of British Architects (RIBA), said, “UK architecture talent is incredibly resilient and we will continue to ensure that our profession has a bright future, whatever the operating environment… Clearly there is uncertainty about the time scales and impact on a range of issues important to our industry, including free movement in the EU for architects as well as students, trading and material sourcing, inward investment relationships, EU procurement rules and the effect on the construction sector if restrictions are placed on EU migration.”

“Clearly there is uncertainty about the time scales and impact on a range of issues important to our industry, including free movement in the EU for architects as well as students, trading and material sourcing…”

Like every business group in the UK and the EU this morning, she added, “RIBA is assessing the short and longer term effect of the withdrawal on our members and the Institute and we will provide further guidance in due course… Most importantly, we will work with colleagues in industry and government to ensure that architects have a strong voice in the coming weeks, months and years.”

 

In a statement entitled “Stability Now“, the London-based Building Engineering Services Association (BESA) said, “The projects carried out by our companies are now even more crucial as we strive to stabilize the economy and move forward… The uncertainty in the build-up to the vote clearly had a detrimental effect on the market with [firms] unsure about investment decisions, and a number of projects suffered delays as stakeholders awaited the outcome. The fallout from our decision to leave the EU now puts pressure on businesses across the country to get projects moving to help stimulate growth.”

Institution of Engineering and Technology (IET) president Naomi Climer added: “We thought it hugely important that the role of UK engineering was considered as part of the EU debate… We are calling for an urgent discussion so that any negative impacts can be mitigated for the benefit of UK engineering and our country’s economy.”

For its part, the Royal Academy of Engineering (RAE) was equally concerned about Brexit’s broader implications for the global economy. “Engineering contributes at least 20% of the UK’s gross value added, and accounts for half our exports,” noted RAE President Ann Dowling. “It is vital that the economy is carefully managed in the wake of the Brexit vote in order to maintain our world-leading position in innovation and industrial development.”

One separate, but ominously related fact: The EU is China’s largest trading partner. So the ripples from what just happened in the UK yesterday are still spreading.

___________________________________________________________________________________

For more on the broader effects on the whole of the built environment in the UK, BuiltWorlds invites you to watch these two informative pro/ con video interviews posted earlier this month by Fred Mills and Tom Payne, co-founders of The B1M, a unique industry online platform that bills itself as “the definitive video resource for BIM.” Its initial aim had been to promote BIM education in advance of the recent mandate.

 

For much more on this unfolding debate, as well as the likely ramifications of what just happened for the construction industry in the UK and across Europe, visit BuildingSpecifier.com.