The United Kingdom (Including Local Crown Dependencies)
The United Kingdom of Great Britain and Northern Ireland (the UK) stands apart from the rest of Europe because of its 2016 Brexit vote. This relatively small country has a rich history, having once had the largest empire the world has ever known. It was the first country to industrialize and has also given the world the English language, penicillin, the jet engine and Shakespeare. It was a founding member of the League of Nations (UN) and contributed greatly to ridding the world of many cruel dictatorships.
The Brexit vote, together with virtual governmental inaction immediately following it to form new trading partners, has cost the country a great deal in lost trade, reduced inward investment and its falling dominance of financial markets. However, in the longer term, it may turn out to have been the right decision for the wrong reasons. The UK was not part of the Eurozone or Schengen free movement area of the EU and so has therefore been able to undertake the divorce with less pain than countries that are more heavily integrated. It also still has a large commonwealth, although this has not so far been utilized as a vehicle for recovery after the shock from losing membership of the EU free trade zone.
Labour relations in the UK today are characterized by a generally weak trade union movement, but with pockets of extreme militancy – particularly in the transport sector. It was one of the first countries to introduce equal pay and anti-discrimination legislation, but remains a long way from achieving practical compliance in these fields. Most new labour legislation owes its origins to EU Directives and Regulations. The UK was, indeed, a pioneer in seeking the 48 – and then the – 40-hour week as an ILO convention and establishing works councils in Germany after WW2. But it has been a reluctant adopter of either principle itself.
The UK’s higher educational system is amongst the best ranked in the world, but its welfare and health systems lag well behind most of its continental neighbours. Culturally, the country is, in effect, four different nations – London, which is one of the most diverse and successful cities in the world (and could easily be a self-contained city state), the rest of England and Wales that is still largely stuck back in the 1950s, Scotland with its highly efficient and progressive government and resourceful population and Northern Ireland where peace has come at the cost of continued backwardness and smouldering sectarianism.
In addition to the four nations making up the UK (England, Northern Ireland, Scotland and Wales) there are other local crown dependencies (The isle of Man, Alderney & Sark, Jersey and Guernsey) that are largely autonomous from the UK – depending only on it largely for defence and foreign affairs. Because of their favourable tax regimes three of these have become fairly important financial centres in their own right. The UK also owns Gibraltar – which is variously classified as still part of the UK itself.
The UK remains a worthwhile location to base a multinational business, largely because it is a major international transport hub and has a fairly significant domestic market. It has a relatively low level of corruption and business regulation, although its tax system is no longer as attractive a draw for international business as much as it once was. Unemployment remains relatively low, but it remains fairly easy to import skilled labour and job protection laws give employers two years before they need to decide if an employee is worth retaining longer term.
Greatest advantages: Relative low level of labour regulation compared to continental neighbours, good financial markets, strong business and cultural links with the USA, a creative and inventive population and high quality (top 50) tertiary educational sector
Greatest disadvantages: Brexit and consequent economic uncertainties (particularly concerning the border between N Ireland the Irish Republic), a poorly run central government, relative low productivity growth, an inadequate telecoms infrastructure, large remaining social and geographical divisions, and the lack of a road link with the European continent.
Proportion of global land area: 1.6%
Proportion of global population: 0.9%
Annual rate of population increase: 0.8%
Life expectancy: Men 79.8years Women 83.5years
Working population in the informal economy: 5% (est)
GSI Modern slavery (Forced Labour) 0.018%
Unemployment rate: 4.8%
GDP/capita PPP (current) $43,081 (2016)
Female labour participation rate: 57.5%
Male labour participation rate: 58.6%
World Bank rating (doing business): 7/190
FedEE overall employment potential rating: 7/10
FedEE regulatory rating: 8/10
Minimum wage rates
– UK: Under 25 £7.05/hour 25+ £7.50 / hour (October 2017)
– Isle of Man: 21-25 £7.20/hour 25+ £7.50/hour (June 2017)
– Jersey (Channel Islands): £7.50 (April 2018)