Following the U.K.’s 52-48 percent vote in favor of leaving the European Union, known as Brexit, many British restaurants are facing weakened sales and higher costs.
The Brexit vote caused the British pound to fall to its lowest point in decades, with the potential to impact even Game of Thrones’ budget. But the effects of Brexit are most felt in high-end London restaurants like Koffman’s, a French restaurant where sales fell 25 percent the week after the Brexit vote.
According to Bloomberg, restaurant sales growth has been halved to 1.3 percent, and almost three-fourths of economists have predicted that the U.K. will hit an economic recession, its first since 2009.
Prices of imported goods, such as wine, could increase with the falling pound. About half of the U.K.’s food is imported. This could lead higher-end restaurants to substitute cheaper ingredients in their dishes.
Immigration restrictions put in place from Brexit could also mean higher labor costs or labor shortages for restaurants. According to The Wall Street Journal 28 percent of the U.K.’s workforce is foreign-born, with about 13 percent from the EU.
“While we would expect that EU workers would still be able to enter the U.K. to meet employment needs, the process could be more complicated and costly for recruiters,” analysts for Moody’s Investors Service wrote in a research report. “A Brexit could result in an uncertain status for EU nationals living and working in the U.K., and vice versa, as well as reducing migration between the two regions.”