Nick Thomas-Symonds says move could also create unnecessary UK-EU trade barriers and increase costs

Services can be supplied through cross-border trade, consumption abroad, commercial presence, and the presence of a natural person. The choice of delivery mode and the extent to which service traders can switch between modes (‘substitution elasticity’) can significantly affect how firms respond to trade barriers. This column analyses UK services trade following the Brexit referendum. UK firms circumvented expected future barriers by switching to modes less affected by Brexit, such as commercial presence sales. However, this came with lower UK employment growth as services exporters prioritised employment growth at their new foreign affiliates rather than at home.