A British exit from the European Union will slash between 2 percent and 5 percent off the country's gross domestic product (GDP), according to Michael Browne, a fund manager at the London-based investment management firm Martin Currie.
Browne said that a so-called Brexit would cause the same level of economic damage to the U.K. as the recessions of 1991 and 2008, hitting consumers and further weaken overseas investment in a country that has seen some promising growth since the last financial crash.
"It wouldn't all happen overnight but that's the sort of cost level you are looking at. You are looking at rising inflation, weaker sterling, would interest rates have to go up? Would you see a movement away, let's say half a million people move out of the U.K., because they return home to get their jobs?," he told CNBC Tuesday.
Bookmaker Ladbrokes is currently predicting there's a 33 percent chance that Britons will vote to leave the European bloc in an upcoming referendum on June 23. The fierce debate has strained relationships and seen major political heavyweights like Prime Minister David Cameron and London Mayor Boris Johnson put forward opposing views.
Analysts at Credit Suisse in January said a "Brexit" would result in an "immediate and simultaneous economic and financial shock for the U.K." It added that it could see a drop in business investment, hiring and confidence. The CBI (Confederation of British Industry) released new independent research last week showing it could cost the economy £100 billion ($142 billion) and 950,000 jobs by 2020.
Meanwhile, the "leave" campaign point to pressures on the U.K.'s state-run national health service, the threat of terrorism and the costs of EU membership. The current concerns over the country's steel industry has added more fuel to the debate with some claiming tight EU regulations has limited the government's response.
In 2014, the International Monetary Fund named the U.K the fastest-growing G-7 economy. The ruling Conservative Party has opted for austerity and spending cuts to right the country's economy since being elected in 2010. However, a global downturn has helped to dent growth and economists continuously puzzle over the country's wide current account deficit and low workforce productivity.
"(The referendum comes) at a bad time for the U.K. economy," Kevin Boscher, chief investment officer at Brooks Macdonald International, told CNBC Tuesday.
He added that the U.K. economy is "already losing momentum quite rapidly" as major institutions downgrade their forecasts for global growth.