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More than one in five British manufacturing companies are expected to lay off workers because of the country’s decision to leave the European Union, according to an industry study published by the Observer on Sunday.

With less than a year to go before the U.K. leaves the 28-member bloc, 11 percent of local manufacturers already have lost contracts because of the 2016 Brexit referendum, based on a survey of 200 British supply chain managers by the Chartered Institute of Procurement and Supply, a trade body.

Almost two-thirds of manufacturing companies also said they would have to increase prices to offset foreign currency costs, while almost half of those surveyed said they had already passed some of these additional costs on to customers, according to the industry report.

“It’s becoming clear that manufacturers can no longer absorb the costs of Brexit, and so the burden of higher prices is spreading to consumers, to suppliers, to clients and reshaping supply chains,” John Glen, an economist at the trade body, told the Observer.

The concerns come as British politicians continue to wrangle over the country’s future economic growth plans after it leaves the EU at the end of March 2019.

Figures published by the U.K. government last week showed that the country’s gross domestic product grew 1.4 percent on a yearly basis in the first three months of this year. That puts Britain at the bottom of the growth charts of the G7 group of the world’s largest economies, and makes the country the only one of the group whose economy has slowed since 2017.

The U.K.’s economic figures “point to the dampening impact of Brexit-related uncertainty on UK business investment and the squeeze on consumers from the weaker pound pushing up UK import prices in 2017,” said John Hawksworth, chief economist at accounting firm PwC, in London.

Source: Politico

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