The so-called “flat white economy” has been declared the largest sector in Britain by the Centre for Economics and Business Research (Cebr).
A new Cebr report on Monday defined the “flat white economy” as a range of services industries, including computer programming, management consulting, creative services, and music publishing.
It became the UK’s largest economic sector in 2017 and remained the biggest in 2018, based upon the productivity metric gross value added (GVA), according to Cebr founder Douglas McWilliams.
GVA is a key metric that’s used to understand how different industries contribute to a nation’s overall economic growth.
“The latest data suggests that by 2018 it had reached 14.4% of GVA. To put this in context, ‘industry’ (which includes manufacturing, mining, power generation, and water supply) was 13.8% of GVA in 2016 and has remained at about that level since,” McWilliams said in the Cebr report.
McWilliams said the “flat white economy” concept was “created by the merge of the digital and creative sectors that so dominates East London.”
Growth in the sector also stood out last year, up 4.6% compared to overall UK economic growth of just 1.4%.
“At a time when the outlook for many other sectors is bleak, this is a welcome ray of sunshine,” McWilliams said.
However, the future of the sector could be at risk as Brexit has created a shift in long-standing immigration patterns.
“Looking forward, the biggest Brexit challenge will be the availability of skilled labour as migration from the [European Union] slows,” McWilliams said.
In the UK, unemployment is at its lowest level in 44 years at 3.9%, according to the latest figures from the Office for National Statistics (ONS). Unfilled job vacancies in the country have spiked as migration from the EU has declined since hitting a peak in 2016.
Overall EU net migration has recently fallen to a level last seen in 2009 as the flow of EU workers has slowed.