Almost two-thirds of medium- and large-sized enterprises have suffered as a result of the uncertainty triggered by the EU referendum, according to a new study.
In a survey of chief financial officers and key decision makers at UK firms with a turnover of £20m or more, 64 per cent of respondents said their business had been negatively affected by the referendum debate, FEXCO Corporate Payments found.
An overwhelming majority (94 per cent) of companies polled said their profit margins were being put at risk by exchange rate volatility, which has ramped up as the Leave side has pulled ahead in the Brexit polls.
The pound plunged 1.4 per cent against the dollar last Friday. Yesterday sterling slipped to an eight-week low against the dollar, and has fallen a further 1.1 per cent against the US currency today. The catalyst for today's fall was a YouGov poll, released last night, which put the Leave side seven points ahead of the Remain camp.
David Lamb, head of dealing at FEXCO corporate payments, said:
With exchange rates now more volatile than at any time in the past seven years, the pound is being jerked around like a rag doll in a hurricane.
A clear majority of medium to large British businesses feel their bottom line has been harmed by such volatility, and a sizeable minority are already considering laying off staff in the event of a vote for Brexit.
While a depreciation in sterling will give a shot in the arm to British exporters, importers lose out as the cost of what they buy from abroad rises.
More than seven in 10 (73 per cent) of respondents also accused Westminster of underestimating the toll taken on businesses by the referendum uncertainty, while 67 per cent said they were already making contingency plans if the UK votes to leave Europe.
In the event of a Brexit vote, 16 per cent said they were already considering laying off staff.
Businesses in London were the most likely to foresee negative consequences from the UK leaving the EU, with 51 per cent of London firms worrying it would be tougher to export to the EU.
Just over a third of those polled, 34 per cent, felt their profit margins would decrease, which was double the proportion who believed their margins would improve (17 per cent).
Businesses and business leaders have been divided over the campaign to leave the EU. A survey from the Institute of Directors in May found a 63-29 split in favour of Remain.