In 2012 49% of foreign owned companies operating out of Britain employed more than 10 people, whereas 89% of British home grown companies employed less than 10 people. Britain has become a nation of micro businesses.
There is possibly an argument that over the years FDI has masked the economic drag of our home grown failures. Every now and again we land with an economic bump when the cushion of FDI isn’t enough to counter the odd hole in the pavement. Our blind faith in traditional industries and outdated employment practices were the cause of many a hole that could have been avoided. Our continuing interest in mining highlights the fact that we haven’t yet entirely got out of that particular hole.
For 30 years the UK’s current account has been in deficit despite the positive effect of primary income, of which only FDI brought in any positive returns. Now FDI is in decline and our current account is heading deeper into deficit at an alarming rate. We aren’t really starting from a firm footing when it comes to the prospect of going it alone.