
Ask HN: Effect of Brexit on DEV Jobs in UK? - usgroup
Given Brexit, over the next few years, in London:<p>1. What will happen to DEMAND and SUPPLY for dev roles?<p>2. What will happen to the CONTRACT and PERM markets for dev roles?<p>My opinion: investment dearth will lead to decreased DEMAND overall and slow CONTRACT market, as business focuses on core and prunes more speculative investment. PERM &#x2F; CONTRACT ratio increases as cut to commercial property prices and labour costs tempts foreign companies to set up ops in UK. Foreign pros in UK leave for a better deal elsewhere, net migration decreases for similar reasons (~20% cut to GBPUSD, 1% inflation...).
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user5994461
IMO: It had no effect on high end tech jobs.

From the recruiters I talked to recently, it had no effect. From the
interviews I had recently, it had no effect. Still recruiting and expanding.

One of my past company recently interviewed with journalists to announce that
they are extending their operations and opening a new office in the USA. The
next day the news published an article "<company> is leaving the UK after the
Brexit". I'll let you imagine the surprise when we discovered the article the
next morning. That's just 100% wrong and misleading.

I'm now willing to extrapolate that 90% of brexit announcements are fake
invented by journalists for sensationalism. Nothing is happening, really.

\-----

Regarding the GBP exchange rate.

As in all the major cities in the world, most of the income goes to pay the
rent. The rent is in local currency, unaffected by USD-EUR-GBP rate.

We might hit a +10% on food price (and gaz) in a near future. It might get
harsh[er] for big families and low income jobs, it's fine for people with good
salaries. (Not to mention free catered lunches at tech jobs :D)

~~~
doc_holliday
"We might hit a +10% on food price (and gaz) in a near future. It might get
harsh[er] for big families and low income jobs, it's fine for people with good
salaries."

However, those people with good salaries whilst seeing inflation running at
10% will likely not see a wage increase to match. And they may also have just
bought a house...

At the same time as 10% inflation, the BoE may eventually have to raise
interest rates to try curb capital flight from Sterling and make it attractive
again.

Higher interest rates & stagnant wages lead to people not being able to keep
up with mortgage payments (which have just increased and so has everything
else but their wage).

This leads to defaults on mortgages at the same time as house prices are
falling because people cannot service such large mortgages at 10% interest.

That will hurt a lot of people with good salaries in the short term.

~~~
pjc50
10% on food and fuel is not the same as 10% inflation overall, though. Rates
are likely to remain low, no more than 1-2%. A bit of wage inflation coming
through would be good but unlikely. I wouldn't panic just yet. There's still
time for the financial services industry to get the message through to their
friends in the conservative party that this is a bad idea.

~~~
usgroup
As in over-turn the verdict? Yes, I wait with abated breath to see how the
court will rule RE article 50 invocation, but thereafter there will be a deal
within 2 years, whether we'd like it or not...

~~~
pjc50
Article 50 has not yet been triggered, and if the court case concludes that
Parliamentary consent is required _or_ the other court case concludes that it
would contravene the Good Friday Agreement, then it probably won't be. The
referendum itself is not binding.

------
ramtatatam
It will be interesting to see consequences of referendum once BREXIT actually
happened (the procedure is not yet started).

In my opinion UK will get similar deal to Switzerland. I would not base my
forecasts on short term fluctuations in GBP or in assumptions that migration
will decrease. Both will depend on actual deal UK will get with EU and I'm
quite sure this deal will be a win-win for both. Because both EU and UK will
get better by continuing to trade together than not to. UK is a major consumer
for EU market and this won't change - and it's in EU best interest to make
sure this won't change.

~~~
Tomte
It took Switzerland _decades_ to get all those trade deals and bilateral
agreements. Without the need to negotiate lots and lots of agreements with
other countries at the same time.

The UK will wake up very soon, very hard to a bleak reality.

~~~
ramtatatam
I'm not sure what would make UK not to get such agreements especially if both
EU and UK are interested in getting them. What politicians are saying is a bit
off from actual business and it's in everybody's business to keep trading and
making money :-)

Anything other than that - I would rather prefer not to make bold statements
that `UK will wake up` etc. until I actually see the deal (ignoring all white
noise produced by politicians and media).

~~~
Tomte
A deal like Switzerland? Really?

Because Switzerland has to let EU citizens in to live and work there. Not
quite as freely as if they were Schengen members, but still.

~~~
ramtatatam
The whole point of immigration was not that immigration itself is wrong but
that decision weather and who to let in was made outside UK. As you can see
Switzerland has got fairly nice model where they attract highly skilled
workforce and there is nothing wrong about trying to get the same model in UK.
And I'm really cheering Brits to get there. Knowing their pragmatism they
will.

~~~
usgroup
... unfortunately the labour pyramid is such that the unskilled workers are
required in much larger numbers than the skilled workers. If they are not
imported then the wages would need to go up very substantially before those
from the UK would be willing to wait tables, flip burgers, etc. Labour cost
inflation from bottom up kills margin.

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IsaacL
Software developers can easily "export" (i.e., take remote jobs for foreign
companies), and a cheaper pound makes them more attractive. I doubt many tech
jobs will move to Berlin -- from what I've heard, despite the hype, London's
tech scene is much bigger and more developed.

The big threat is from finance. Tech salaries are held up by the huge numbers
of devs working for banks, and that would change if there's a major impact to
the finance sector. Apparently the City is pretty robust, though, and Euro-
related business is only a small amount of their activity.

~~~
usgroup
> ... Euro-related business is only a small amount of their activity.

I'd doubt this since the clearing of Euro denominated derivatives are done in
London.

> Software developers can easily "export" (i.e., take remote jobs for foreign
> companies)...

I'm not sure about this simply because the salaries in London are so much
larger than everywhere else in the UK. You'd think other regions would be able
to export to London given the huge disparity but they don't. Are you sure this
is true for other cities?

------
doc_holliday
"(~20% cut to GBPUSD, 1% inflation...)"

IMO we are about to hit much more than 1% inflation with the devaluation of
our currency.

Think how much petrol has gone up, food is about to go up, imports are going
up etc.

We will have much more than 1% inflation annually next year I think, and I
don't think wages will keep up. That is if things go ahead as they currently
are.

On the flipside this makes Devs in the UK much cheaper, and if we have the
combination of inflation and stagnant wages then the housing market will
collapse, which will eventually make UK more competitive.

~~~
usgroup
What do you think will happen RE Q1 and Q2 over the next few years? Net
increase DEMAND for DEV? What about SUPPLY of dev?

~~~
NetStrikeForce
I think demand will be less affected in the short term as EU nationals might
be starting consider offers outside the UK (uncertainty + low GBPEUR).

My anecdotal data has a count of 2 people having accepted offers to leave
between the Brexit vote and now, both citing Brexit as a reason. Partly from
the feeling rejected side, partly from the pragmatic point of view.

------
heisenbit
It may be worth distinguishing tech vs. financial tech. Tech will benefit from
lower exchange rate. Also tech is quite fungible and crosses boundaries
easily.

Financial tech is different. 1) Banking is a huge part of London economy and
London is a big part of the UK 2) Financial Tech is very dependent on banking
3) Banking in London in the past has huge structural advantages as a
bride/conduit with English language, proximity to US markets and no barrier to
the rest of Europe) which it is going to loose. London's European
organizations will either split or wholly shift to other locations (Paris,
Frankfurt and Dublin).

As financial tech dominates particularly in the UK there will be a negative
impact. To what extent it is cushioned by lower immigration remains to be
seen. Certainly not in the short term.

------
pyb
London's tech industry relies heavily on immigration, as well as easy access
to other EU markets. I'm afraid we'll see a big shift to Berlin and other
places.

I say this as someone who'd only reluctantly relocate from London, but I can't
see how the tech industry will stay afloat, given recent developments.

------
heldrida
(living in London for 5 years, Non-British / EU citizen)

Took me 10 weeks to find a new opportunity (recently) applied for permanent
and freelance/contractor/contract roles.

Comparing with the previous years, where it took me less than 2 to 5 days,
there's a difference.

Housing has never been so expensive & the currency never been this low -
during the period I've lived here.

Contracting - some companies stopped paying better for overtime work:
Weekends, bank holidays are the same rate and not 1.5 or 2 units.

