UPDATE 1-Brexit costs UK workers £470 a year, study predicts

* Study says Britain is becoming a more closed economy

* One of the authors to join the BoE Monetary Policy Committee

* Government says reforms to boost growth (adds government response)

By David Milliken

LONDON, June 22 (Reuters) – Britain is becoming a more closed economy as a result of Brexit, with long-term damaging effects on productivity and wages, pushing the average worker to £470 ($470) by the end of the decade. 577) per year will be poorer, a study forecast on Wednesday.

The report was authored by Swati Dhingra, an associate professor at the London School of Economics – who will join the Bank of England’s Monetary Policy Committee in August – and researchers at the think tank Resolution Foundation.

The COVID-19 pandemic, which struck just after Britain left the European Union in January 2020, has complicated the task of analyzing the impact of Brexit.

New post-Brexit trade rules that came into effect in January 2021 have not led to a continued decline in UK trade with the EU compared to the rest of the world, the researchers said, contrary to many analysts’ earlier expectations.

“Instead, Brexit has had a more diffuse effect by reducing the UK’s competitiveness and openness to trade with a wider range of countries. This will ultimately reduce productivity, as well as workers’ real wages,” said Sophie. Hale, an economist at the Resolution Foundation.

The UK government said in response to the report that it was working on new legislation to boost growth, and that trade with the EU was now above pre-pandemic levels.

“Since we left the European Union, we have begun to seize new opportunities to improve UK regulation for businesses and consumers through plans to increase competition and take advantage of new technology,” said a spokesperson.

Britain is not faced with tariffs on goods exports to the EU, but there are greater regulatory barriers.

The report said the net effect of this would reduce productivity across the economy by 1.3% by 2030 compared to an unchanged trade relationship – translating into a 1.8% real decline in £470 annual wages. per employee.

These figures do not include an assessment of the effect of changed migration rules.

The impact for some sectors will be much greater. Britain’s small but high-profile fishing industry – with many members strongly advocating Brexit – was likely to shrink by 30% due to difficulties in exporting its fresh catch to EU customers, the report said.

By contrast, while highly regulated professional services such as finance, insurance and law will find it more difficult to serve EU clients, their share of the UK economy is likely to fall by only 0.3 percentage points to 20.2%. ($1 = 0.8151 pounds) (Reporting by David Milliken, Editing by Angus MacSwan and Andrew Heavens)

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