Business news 11 July 2025
GDP unexpectedly falls. Business confidence hits three-year low. Financial services, work experience, markets, Heathrow, cyber arrests, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
📉 GDP unexpectedly falls
The UK economy unexpectedly shrank 0.1% in May, the second monthly contraction. Analysts had expected a 0.1% expansion. Weakness was concentrated in production output, down 0.9%, and construction, which fell 0.6%.
The government has made boosting economic growth a key priority and Chancellor Rachel Reeves said the latest figure was “disappointing”.
The contraction in the economy in both April and May shows the outlook for growth “remains fragile”, said Hailey Low, associate economist National Institute of Economic and Social Research.
The UK economy clearly remains weak, and SMEs are increasingly under acute pressure as the cost-of-living squeeze persists. Cash is king and businesses urgently need to rethink their financial frameworks to strengthen stability and resilience. CPA can help improve their cash flow by protecting them from giving credit to those who are a credit risk and by improving payment behaviour through our Overdue Account Recovery Services which resolves 84% of debts within 18 days.
🏙️Business confidence hits three-year low
Business confidence in the UK has fallen to its lowest level in three years, primarily due to rising taxes and economic instability. The ICAEW’s confidence monitor index hit -4.2 for the second quarter. ICAEW chief executive Alan Vallance said: “A cocktail of costs, including the National Insurance rise and global instability, has made life especially difficult for businesses.” Over half of the 1,000 accountants surveyed expressed concerns about potential tax increases later this year, with predictions that Chancellor Rachel Reeves may need to raise £30bn. The report also highlighted a decline in employment expectations and export sales, while a British Chambers of Commerce poll found that 28% of SMEs have seen a decrease in export orders.
🏦UK’s financial services dominance wanes
The UK’s position as a financial services leader is under threat, with a poll from the CRIF showing that almost half of senior financial professionals believe the UK’s dominance is declining and more than 40% would no longer consider the country a global leader in the industry. Over 30% of those polled said missed investment was driving the downturn. Analysis from KPMG shows that fintech investment fell by 27% to £7.9bn in 2024, from £10.1bn in 2023. Sara Costantini, regional director for the UK & Ireland at the CRIF, warned: “Without decisive action, new markets will continue to catch-up with and challenge London’s long-held crown as a leader in financial services.”
🎓 IPPR in work experience warning
The challenge of securing work experience is hindering many young people from entering the workforce, with the Institute for Public Policy Research revealing that two in five 18 to 24-year-olds have never completed any work experience. Increased regulation, including mandatory pay and insurance requirements, has made internships particularly difficult to obtain, especially in smaller firms. Analysis shows that traditional internships are too expensive for many to undertake, with a study from the Association of Accounting Technicians showing that 41% of students have less than £8 a day to spend on work and related costs such as travel and food. Lizzie Crowley, skills adviser at the Chartered Institute of Personnel and Development, says that while traditional internships “remain out of reach for many young people,” micro-internships “can offer a route in.” These shorter, flexible opportunities allow students to gain valuable experience while balancing their studies.
📈Markets
📈Yesterday, the FTSE 100 closed up 1.23% at 8975.66 (due to gains in the mining sector amid higher copper and iron prices) and the Euro Stoxx 50 closed down 0.14% at 5438.27. Overnight in the US the S&P 500 rose 0.27% to 6280.46 and the NASDAQ rose 0.09% to 20630.66.
Overnight Trump announced more tariffs. He told NBC news he is considering tariffs of 15% or 20% on most trading partners. EU members will receive letters by Friday. He also added a 35% tariff on US goods not covered by their existing trade agreement.
The Brazilian president struck a defiant tone against Trump, saying the country can survive without US trade and will seek other trading partners.
💲This morning on currencies, the pound is currently worth $1.353 and €1.158 .
On Commodities, 🛢️Oil (Brent) is at $68.8 & 💰 Gold is at $3337.
📈On the stock markets, the FTSE 100 is currently down 0.3% at 8950 and the Eurostoxx 50 is down 0.9% at 5388.
💰Bitcoin’s broken through $112,000 for the first time and the next stop may be $120,000.
US Unemployment Claims unexpectedly declined last week as the pace of layoffs held low, the Labor Department reported Thursday. Jobless claims totaled a seasonally adjusted 227,000 for the week ending July 5, down 5,000 from the previous period and below the estimate for 235,000.
🏙 City calls for investment hub
The City of London Corporation has called for the creation of an investment hub for financial services, saying that this could streamline investor engagement and unlock as much as £10bn in capital for growth. In a report produced in collaboration with the Treasury, the Corporation said the hub would serve as a “strategic one-stop shop” for international investors and deliver “joined-up, tailored support.” This, it adds, would help attract and retain financial services investment. It would also offer regulatory guidance. Chris Hayward, policy chairman at City of London Corporation, said: “This is a now or never moment for UK financial services. If we don’t act decisively, we risk losing our global position and the economic prosperity, jobs and innovation that come with it.”
👮Teens linked to hacks that cost M&S £300 million arrested
The National Crime Agency has arrested four people over a series of disruptive cyberattacks that targeted leading British retailers earlier this year. The authorities detained three teenage males and one 20-year-old female in the West Midlands and London on suspicion of Computer Misuse Act offenses, blackmail, money laundering and participating in the activities of an organized crime group, the agency said in a statement Thursday.
🛬 Heathrow
Heathrow Airport plans to invest £10 billion over five years to upgrade terminals and increase capacity by 12%, adding 10 million passengers a year.. The plan forms the core of the airport’s 2027–2031 business proposal, which was submitted to the Civil Aviation Authority today.
💁Fintech leads increase in finance hiring
New financial services jobs vacancies rose 3% quarter-on-quarter in Q2, according to Morgan McKinley’s London Employment Monitor, with fintech and demand for risk professionals driving the increase. Financial services vacancies in London were up 14% year-on-year, hitting 4,800. The report also suggests that fintech hiring in London is set to jump by 72% in 2025. Morgan McKinley’s analysis found hiring sentiment remained “cautious” as global volatility, trade uncertainty and tax hikes having an impact. Mark Astbury, director at Morgan McKinley, said: “Many firms remain cautious on headcount due to ongoing cost-cutting and economic uncertainty and the Government’s decision to raise employer National Insurance contributions have tempered business confidence and impacted hiring.”
🏗 Regulator accused of slowing developments
The Building Safety Regulator (BSR) has been accused of delaying developments in London, with data showing that just 871 affordable homes having been built in the capital since 2021. This is just over 5% of the current housebuilding target for March 2030 – and just over 3% of an original housing target which was reduced in May. Critics argue that the BSR is slowing the planning process, warning that it often takes longer than its target of eight weeks to decide on an application. Melanie Leech, chief executive of the British Property Federation, said that delays in the system are “undermining investor confidence” in the sector and “holding back the delivery of new homes.”
🏦Bank closures surge since 2016
British banks have closed an average of eight branches a week since 2016, according to research from investment platform Lightyear. The analysis shows that almost 3,700 sites closed between 2016 and 2024. Barclays and NatWest led the way, shutting 1,236 and 950 branches respectively. Lloyds closed 855 in the same period, while HSBC shuttered 743 and Santander closed almost 500 sites. Over 370 closures are planned for the coming year, with Halifax set to shut 99 branches and Santander poised to axe 95.
🖥 FCA cracks down on rogue websites
The Financial Conduct Authority (FCA) suspended or banned over 1,600 websites for promoting financial services without the necessary permissions last year. In 2024, the regulator intervened to ensure almost 20,000 non-compliant financial promotions were amended or withdrawn by authorised firms, compared with under 600 in 2021. The City watchdog also worked with technology platforms to remove 50 apps from Google Play and the App Store. FCA chief executive Nikhil Rathi said: “We have embraced data to crack down on harm.”
💷Extended threshold freeze could hit 1m Brits
Extending the income tax threshold freeze could lead to higher tax rates for a million Britons. The freeze, which has been in place since 2022, is set to end in 2028, but extending it to 2030 could generate an additional £10bn for the Treasury, according to the Institute for Fiscal Studies (IFS). By 2028, an estimated 3.5m more people will fall into the higher-rate tax band. IFS director Helen Miller has told BBC Radio 4’s Today programme that extending the freeze “absolutely would” be a tax on “working people,” highlighting a lack of transparency in such a measure. Rachel Reeves, the Chancellor, affirmed her commitment to not extending the freeze beyond 2028/29 during her Budget, saying that “it would take more money out of their payslips.” She added: “I am keeping every single promise on tax that I made in our manifesto. There will be no extension of the freeze in income tax and National Insurance thresholds beyond the decisions by the previous government.” With Sir Keir Starmer this week promising to adhere to manifesto commitments and the Government’s fiscal rules, a Conservative spokesman said that while the Prime Minister “emphatically ruled out any rises in income tax, NI or VAT … he wouldn’t repeat the promise his Chancellor made in the autumn to lift the freeze on income tax thresholds.”
📨Royal Mail to end second-class post deliveries on Saturdays
Ofcom have announced that from 28 July, Royal Mail will start to deliver second-class letters on every other weekday and not on Saturdays to help cut costs. The industry regulator said a reform to postal service was needed as people are sending fewer letters each year, so stamp prices keep rising as the cost of delivering letters goes up. The changes mean second-class letters will be delivered either on Monday, Wednesday and Friday, or on Tuesday and Thursday, in a two-week cycle.
💰London bosses in wealth tax warning
Business leaders in the capital have expressed concerns that the introduction of a wealth tax could lead to reduced Government revenue and drive investors abroad. John Dickie, chief executive of BusinessLDN, said the Government “needs to avoid own goals,” urging policymakers to dismiss the idea of a wealth tax to prevent damaging speculation. Former Labour leader Neil Kinnock has suggested that a wealth tax could generate £24bn, but economists warn that similar taxes in countries like France and Spain have resulted in lower growth and the departure of wealthy individuals. The Institute for Fiscal Studies has highlighted potential administrative costs, while the Centre for Economics and Business Research cautioned that the UK could lose 16,500 millionaires due to stricter tax policies.
🗣Wealth tax a ‘moral abomination’
Sherelle Jacobs in the Telegraph says a wealth tax proposed by some within Labour is not only impractical but also morally questionable, as it infringes on individuals’ rights to their legally acquired assets. She argues that a wealth tax would ultimately harm the economy and drive away investment.
🏦Savers scramble to shield cash
Savers are hurrying to protect their funds from potential income tax changes, with a notable increase in cash ISAs following reports of a possible reduction in the £20,000 tax-free allowance. Skipton Building Society noted a 45% rise in new accounts, while Leeds Building Society reported a 47% increase. The Building Societies Association has warned that cuts could hinder mortgage affordability and undermine economic growth, saying: “Any significant reductions to the cash ISA limits would make this funding more scarce.”
🏭Government could take control of steel plant
The future of Speciality Steel UK (SSUK) hangs in the balance as the Government considers taking control if the company enters administration following an insolvency hearing. Business Secretary Jonathan Reynolds is contemplating options to save the plant, which employs 1,450 people. SSUK has incurred losses of £340m over four years and despite having the UK’s largest electric arc furnace, the Rotherham plant has been inactive for a year due to financial constraints. Sanjeev Gupta, owner of the Liberty Steel Group, is seeking new investment and has been in talks with potential investors.
🚨Latest Insolvencies
Appointment of Administrator – XL JOINERY LIMITED
Appointment of Administrator – AXIS LOGISTICS LIMITED
Appointment of Administrator – WESSEX WELDING AND FABRICATIONS LTD
Appointment of Administrator – QUEEN MARGARET’S SCHOOL, YORK LIMITED
Appointment of Administrator – RYEBECK TRADING COMPANY LTD
Appointment of Liquidators – BANK SQUARE HOLDINGS LIMITED
Appointment of Liquidators – DEMAND SOLUTIONS (EUROPE) LIMITED
Appointment of Administrator – HONK HONK GROUP LIMITED
Appointment of Liquidators – A MORRISSEY & ASSOCIATES LIMITED
Appointment of Liquidators – LODDON SYSTEMS LTD
Appointment of Liquidators – LOOOP ONLINE LIMITED
Petitions to wind up (Companies) – FLASH FASHION 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!