Business news 7 January 2025
The Skills chasm, retails golden quarter fails, Restaurants, Services jobs, food inflation, WFH, watches, house prices, AI, markets, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
Skills chasm threatens UK growth
The Learning and Work Institute (LWI) warns that the UK’s economic growth is at risk due to a widening “skills chasm” between regions. By 2035, 71% of Londoners and 65% of adults in Scotland are projected to hold degrees, contrasting sharply with just 29% in East Yorkshire. Stephen Evans, LWI’s chief executive, said: “This report shows a tale of two countries, with the magnetic pull of London drawing in talent from elsewhere.” The report highlights that areas like the West Midlands have 27% of adults with qualifications below GCSE level, compared to only 9% in west London. To close this gap, over 4m additional people outside London would need higher education qualifications. A Department for Education spokesperson said: “We have established Skills England to tackle skills shortages and support businesses to drive growth. It will ensure we have the highly trained workforce needed for the industries of the future, laying the foundations for stable growth.”
Festive ‘golden quarter’ fails to deliver for retail
The “golden quarter” of 2024 has not provided the anticipated boost for UK retailers, as consumer confidence remains low. According to the British Retail Consortium-KPMG Retail Sales Monitor, sales increased by only 0.4% in the three months leading to December compared to the previous year. December’s sales, including Black Friday, saw a 3.2% year-on-year rise, but food sales grew by just 1.7%, significantly lower than the previous year’s 6.3% growth. Looking ahead, sales growth is projected to average 1.2% in 2025, which is below the expected shop price inflation of 1.8%, indicating potential volume declines. Retailers may respond by increasing prices and reducing investments. Separate figures from Barclays show zero growth in consumer card spending in December, as households cut back on essential items and pub and restaurant meals in favour of spending on experiences.
Restaurants braced for worst year ever
Despite a bustling dining scene in London, restaurants are grappling with significant challenges. The Centre for Policy Studies warns that the upcoming year could be the most expensive on record for businesses reliant on low-wage workers, with the cost of employing a full-time minimum wage staff member set to rise by £2,367. Michael Kill, chief executive of the Night Time Industries Association, believes more managers will have to pull pints and take deliveries this year as shift staff are cut. This comes as the Federation of Small Businesses reported that 92% of small employers are concerned about the Government’s Employment Rights Bill, with many planning to reduce headcount.
Job cuts surge at UK services firms
The S&P Global UK services PMI survey revealed a score of 51.1 in December, a slight increase from November’s 50.8, indicating marginal growth. However, the services sector is experiencing its most significant job cuts since January 2021, driven by concerns over weak consumer confidence. Tim Moore, economics director at S&P Global Market Intelligence, said: “Survey respondents suggested that falling business and consumer confidence… had led to a considerable loss of growth momentum.” Despite some areas showing robust expansion, overall demand remains weak, with 23% of businesses reporting workforce reductions. The outlook for new orders is subdued, and many companies are freezing hiring due to rising payroll costs and economic uncertainty.
Food inflation forecast to soar
Analysts at Peel Hunt predict that UK food inflation may reach 4% by the end of 2025, a significant increase from their previous forecast of 1.5%. This adjustment is attributed to rising employer national insurance contributions, a hike in the national living wage, and the implications of the Employment Bill. The report highlights the UK’s dependence on EU imports and the challenges posed by regulatory changes, which are expected to further elevate prices. Peel Hunt stated: “For now, it is not food commodities, crude oil or sterling causing food inflation in the UK as opposed to the UK Government’s policies.” The forecast suggests that food prices will continue to rise, with the impact of these changes likely felt at the consumer level.
Markets
Yesterday, the FTSE 100 closed up 0.31% at 8249.66 and the Euro Stoxx 50 closed up a massive 2.36% at 4986.64. Overnight in the US the S&P 500 rose 0.55% to 5975.38 and the NASDAQ rose 1.24% to 19864.98.
Nvidia shares rose premarket after it unveiled a new lineup including GPU chips to hold its dominance of the AI boom and also moved into the user market with a $3,000 desktop computer. The chipmaker also announced partnerships with Toyota and Uber, showcasing its vision for AI-powered robots, factories and self-driving vehicles.
This morning on currencies, the pound is currently worth $1.254 and €1.2045. On Commodities, Oil (Brent) is at $77.05 & Gold is at $2650. On the stock markets, the FTSE 100 is currently down 0.3% at 8220 and the Eurostoxx 50 is up 0.49% at 5011.
Canadian PM Justin Trudeau has announced he will resign when his party elects a new leader. The move comes after weak opinion polls and a loss of support from within his own Liberal party. Mark Carney said he’s considering entering the race to replace Justin Trudeau as Canada’s PM. Trump said Canada should join the US as the 51st state. The Toronto market response was to fall 0.29%
Euro-area inflation accelerated to 2.4% last month, up from 2.2% in November and matching the median estimate in a Bloomberg poll. That supports the ECB’s gradual approach to cutting interest rates.
Investors flock to digital assets
Recent research by Whisky and Wealth Club reveals that cryptocurrencies have emerged as the third most popular investment in the past year, with a remarkable 49% increase in online searches. Despite their volatility, digital assets are attracting investors looking for high-risk, high-reward opportunities. In 2024, global crypto investment reached a record $44bn (£35bn), according to CoinShares. The Financial Conduct Authority (FCA) reports that 7m people in the UK own some form of cryptocurrency, reflecting a shift towards alternative investments beyond traditional assets.
Watch out!
Prices for used watches fell last year, with the Bloomberg Subdial Watch Index at its lowest since 2021. Popular Rolex models dropped 5%, Patek Philippe fell 4% and Audemars Piguet lost about 7.5%.
House Prices
UK house prices dipped 0.2% in December from a record, the first drop in nine months, Halifax said. Overall, prices were up 3.3% in 2024, the strongest performance since 2021.
London mansion sales take a hit
Sales of London mansions have significantly decreased, with a drop of over 25% in £15m-plus home sales last year, according to analysis by Beauchamp Estates. The total value of these transactions fell from £1.3bn in 2023 to £856.5m in 2024. Jeremy Gee, managing director of Beauchamp Estates, said: “Stamp duty, non-dom changes, the election and new government have disrupted the sales market.” The number of ultra-prime new-build apartments sold also halved, and the average size of sold flats decreased by 27%. UK buyers now represent only 10% of the ultra-prime market, while American buyers have increased to 25%.
WFH: Employers are in the driving seat
As the working from home (WFH) trend wanes, 2025 may mark a significant shift back to the office for many Britons. James Reed, chairman and CEO of the Reed Group, says in a piece for the Express that “proper face time with colleagues… is important after all.” Research indicates that 68% of companies are encouraging employees to return to the workplace, as productivity levels remain a concern. Despite some resistance, with 29% of workers believing office presence won’t aid progression, the “in-person premium” is expected to grow in importance amid a cooling jobs market. The rise in job applications by 19% in 2024 suggests a wealth of talent available for employers, says Reed, making it crucial for job seekers to be present in the office to enhance their career prospects.
AI won’t replace these jobs
Recent research by Adzuna, utilising data from Goldman Sachs and the Organisation for Economic Co-operation and Development (OECD), has identified jobs least likely to be affected by artificial intelligence (AI). The study highlights that roles requiring specialist human interaction, such as dermatologists, are among the safest, with an average salary of £86,229 and a significant increase in job vacancies. Other resilient professions include dentists, veterinarians, and various blue-collar jobs like plumbers and carpenters. The International Monetary Fund has projected that AI could impact nearly 40% of all jobs over time, but this research suggests that certain careers will remain in demand despite technological advancements.
Voters work 30-years longer for same pension as MPs
Analysis by AJ Bell reveals a stark contrast in retirement provisions between MPs and average workers. An average worker earning £37,430 would need to work 52 years to match the retirement income of an MP, who only requires 20 years of service. Steven Cameron from Aegon UK highlighted the “huge gap” in pension provision, stating: “MPs build up very valuable public sector defined benefit pensions which are simply out of reach of most in the private sector.” The disparity is set to widen further as defined contribution pensions will be subject to inheritance tax from April 2027, while MPs’ pensions remain unaffected. The public sector pensions bill is projected to exceed £36bn this year, with total guaranteed pensions nearing £5trn.
Nearly 25,000 people filed tax returns on New Year’s Day
As the January 31 deadline approaches, 5.4m individuals are hurrying to complete their tax returns. According to HMRC, nearly 25,000 people submitted their returns on January 1, while 38,260 did so around New Year’s Eve. Missing the deadline could lead to an initial £100 fine, even if no tax is owed, with additional penalties accruing over time. Myrtle Lloyd, HMRC’s director general for customer services, stressed the importance of timely filing, stating: “We know completing your tax return isn’t the most exciting item on your new year to-do list, but it’s important to file and pay on time to avoid penalties or being charged interest.”
Labour urged to do more to combat child poverty
The Resolution Foundation has urged Labour to provide additional support for working parents to effectively tackle child poverty. Their report, titled Working Poverty Out, highlights that 70% of families in poverty now have at least one working parent, a significant increase from 49% in 2000. The report stresses the importance of addressing childcare costs and availability, as well as enhancing workers’ rights to help families improve their financial situations. Currently, nearly 30% of children in the UK live in relative poverty after housing costs, with 4.3m children affected.
Latest Insolvencies
Appointment of Liquidators – AIDE DATA LIMITED
Petitions to wind up (Companies) – MJ’S THE FORT LTD
Appointment of Liquidators – ECS LABS LTD
Appointment of Liquidators – CMR IMPROVEMENT SERVICES LTD
Appointment of Liquidators – CEPF II BATH LIMITED
Petitions to wind up (Companies) – GLOBAL HEALTHCARE MARKETING LTD
Appointment of Liquidators – ENORASIS LIMITED
Petitions to wind up (Companies) – CAMBRIDGE KITCHENS LIMITED
Petitions to wind up (Companies) – G T E MOTORS LIMITED
Appointment of Administrator – PLATFORM NINE LTD
Appointment of Liquidators – IFOR GRIFFITHS LIMITED
Petitions to wind up (Companies) – KINGSWAY EIFS STUCCO LTD
Appointment of Liquidators – TS ASSOCIATES (UK) LIMITED
Petitions to wind up (Companies) – SPICE COTTAGE WORCESTER LTD
Petitions to wind up (Companies) – OL BUCKINGHAMSHIRE – MILTON KEYNES – STATION HOUSE LTD
Appointment of Liquidators – METRO PARKING LIMITED
Petitions to wind up (Companies) – LUNGA NKOBI INVESTMENT PROPERTIES LTD
Appointment of Liquidators – TROJAN CONSTRUCTION (SERVICES) LIMITED
Appointment of Liquidators – ESSENTIALS TECHNOLOGIES LIMITED
Petitions to wind up (Companies) – ESSERE BELLA BOUTIQUE LIMITED
Appointment of Liquidators – EILDON PROPERTIES LIMITED
Petitions to wind up (Companies) – GRAFT ENTERTAINMENT LIMITED
Appointment of Liquidators – LIVEWIRE (WARRINGTON) CIC
Petitions to wind up (Companies) – LIPEX SERVICES LIMITED
Appointment of Liquidators – E. MIGNANO LIMITED
Appointment of Liquidators – LETSASI LIMITED
Petitions to wind up (Companies) – T P S PLANT & GROUNDWORK LIMITED
Petitions to wind up (Companies) – JOTT-JUST OVER THE TOP-UK LIMITED
Petitions to wind up (Companies) – CLEAN MARINE GROUP LIMITED
Petitions to wind up (Companies) – DGD HOLDINGS LTD
Petitions to wind up (Companies) – ARTIFIN BUSINESS SOLUTIONS LTD
Appointment of Liquidators – BOC BRANDING LIMITED
Petitions to wind up (Companies) – DASEIN VFX LTD
Appointment of Administrator – ANDREWS MARQUEES LIMITED
Appointment of Liquidators – FOSTERMCO LTD
Appointment of Liquidators – WARD BROS BUILDING CONTRACTORS (LOSCOE) LIMITED
Why you should become a member of CPA!
The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid, since 1914. We have supported our members through all sorts of difficult trading environments. With high interest rates and a struggling economy and elevated insolvencies, our services can help your business navigate these difficult waters.
Unlike other credit management and debt collection companies, we offer a range of services to our members that are all included as part of a fixed annual subscription, tailored to your needs.
Under your annual subscription you will have access to our main services:
- Our Creditcare credit reports provide credit ratings and limits along with a host of detailed information on your potential customers to enable you to trade with confidence and set appropriate credit policies for new customers.
- Our monitoring service will alert you to any significant changes in the status of those customers.
- Our Overdue account recovery service can be used to chase up payment on any invoices to those customers that have not been paid on time. Unlike other debt collection companies, this service directs your customer to pay direct to you and allows you to maintain your goodwill with them, rather than inserting ourselves into your relationship with you customer and insisting they pay CPA instead. Our Overdue account recovery service resolves over 80% of accounts referred to us.
All of the above services and other complimentary services such address verification, are included in your subscription!
And for the small minority of debts not resolved through our Overdue account recovery service, you can refer the debt to our collections department to escalate the late payment collections process.
CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. And we provide credit information so you can monitor and assess your key customers and be warned of any potential risks. CPA has been improving business cash flow for over 100 years, by tackling late payers and campaigning against the late payment culture in the UK.
Unlike other credit management companies, we offer our members a fixed annual subscription regardless of how high the value of their debts maybe!
Rather than to borrowing more money to improve your cashflow, CPA suggests that business owners tackle the problem at its source. If late payments are a strain on your cashflow, then talk to CPA about how we can help you reduce those late payments.
Just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.
When you see your money come in, you will be so glad you used CPA.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Do you have a commercial late payer that is causing you grief? Use CPA’s no-win, no-fee, commercial debt recovery service!
If you have a particular business customer who is late paying and causing you sleepless nights, why not offer it to CPA’s collection department for purchase on recourse?
CPA’s collection department will then pursue the debt. We will be liable for any costs incurred and then when we have recovered the debt, we will pay you the net principle debt recovered less our percentage.
Once you have enjoyed that success then you can consider the more cost effective membership which includes our Overdue Account Recovery service and Status/Credit reports as well as a range of other complimentary services.
Just call 020 8846 0000 and ask for Godfrey Nelson or Cris Shirley (business hours) or email debtpurchase@cpa.co.uk today.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.
Get compensated for previous late payments
Have you been paid late by business customers in the last six years?
Maybe you no longer work with them. Under legislation, you are entitled to compensation you for those late payments you have suffered.
You put up with the PAIN – now claim the GAIN!
Claim late payment compensation (LPC) from former business customers who paid you late in the last six years!
CPA (LPC) Recoveries is using our bespoke software and decades of experience to do just that for our clients
Check our compensation calculator to see how much your business could be owed!
Discover NOW the potential value of late payment compensation hidden in your sales ledger!
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.