Five years on, 3 Five key impacts of Brexit

Five years ago, on 31 January 2020, the UK officially left the European Union, severing its 47-year political ties. However, it remained in the EU’s single market and customs union for an additional 11 months to ensure the continuation of trade. Northern Ireland had its own separate arrangement.

Brexit proved to be highly divisive, sparking intense political and social debates that have persisted for years. Now, five years on, media reviews three key ways Brexit has impacted the UK.

1) Trade Economists generally view the UK’s departure from the EU single market and customs union, effective 1 January 2021, as having a negative impact on UK trade. While a free trade agreement was negotiated with the EU, preventing tariffs on goods, the introduction of “non-tariff barriers”—such as time-consuming paperwork—has complicated trade between the UK and EU.

Estimates suggest UK goods exports are 30% lower than they would have been had the UK remained in the single market, though some studies indicate a 6% reduction. Small UK businesses have been hit hardest by the new bureaucracy, as they struggle to handle cross-border trade requirements. On the other hand, UK services exports, like advertising and consulting, have performed better than expected since 2021.

The Office for Budget Responsibility (OBR) has predicted that in the long term, Brexit will reduce trade by 15% and shrink the UK economy by about 4%, or roughly £100bn. Though new trade deals with countries like Australia, New Zealand, the US, and India have been signed, their economic impact is considered relatively small compared to the negative effects on UK-EU trade. However, some economists believe there could be long-term benefits from not having to follow EU regulations in areas like Artificial Intelligence.

2) Immigration Immigration was a key issue in the 2016 referendum, particularly concerning freedom of movement within the EU. Since the referendum, there has been a significant decline in EU immigration, accelerating after 2020 with the end of free movement. At the same time, net migration from non-EU countries has risen, driven by work visas (especially in healthcare) and a surge in international students.

The UK introduced a new post-Brexit immigration system in January 2021, requiring both EU and non-EU citizens to obtain work visas (with the exception of Irish citizens). Universities in the UK increasingly recruited non-EU students, and the government’s decision to allow overseas students to stay and work after graduation made the UK more appealing. However, Conservative governments have imposed restrictions on dependents accompanying work and student visa holders, which have been maintained by the Labour party.

3) Travel The end of free movement has also impacted travel, with British passport holders no longer able to use “EU/EEA/CH” lanes at EU border crossings. UK citizens can still visit the EU for up to 90 days within a 180-day period without a visa, as long as their passports have at least three months of validity.

In 2025, the EU plans to implement a new electronic Entry Exit System (EES) for travelers from non-EU countries, requiring biometric data and travel details. While this system is expected to replace manual passport stamping, concerns about longer border queues have been raised. Additionally, six months after the EES rollout, the EU will introduce the European Travel Information and Authorization System (ETIAS), requiring UK citizens to apply for travel clearance to 30 European countries at a cost of €7 (£5.90).

In turn, the UK will launch its own electronic travel authorization system (ETA) for EU citizens starting 2 April 2025, with a fee of £16, though Irish citizens will be exempt.

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