Business news 14 October 2025

UK business confidence remains fragile ahead of next month’s Budget, as fears of higher taxes and slowing demand weigh on investment. The British Chambers of Commerce has warned that additional tax rises could “sink struggling businesses,” while weaker labour and retail data hint at a fragile economy. Meanwhile, record silver prices, falling oil, and a surge in cyberattacks underscore the volatile environment facing small firms — especially those extending credit or reliant on steady cashflow.

James Salmon, Operations Director.

Top stories for UK SMEs

1. Tax rise fears dominate the pre-Budget mood
Business leaders are warning the Chancellor against £30 billion in potential tax increases. Shevaun Haviland of the British Chambers of Commerce said higher levies risk “sinking businesses that are struggling to survive.” A BCC survey found that a quarter of firms have already scaled back investment since the April rise in employer National Insurance, while a third have made or are considering redundancies. The group has called for a freeze on business taxes and a reform of business rates.

2. UK labour market cools, unemployment hits 4.8%
ONS data show unemployment at 4.8% in the three months to August — the highest since 2021 — while private-sector pay growth eased to 4.4%. Payroll numbers fell by 10,000 in September, but revisions reveal job losses have been smaller than previously feared. Economic inactivity remained at 21%, the lowest since before the pandemic, suggesting a gradual return to the workforce.

3. Retail slowdown ahead of the ‘golden quarter’
Retail sales rose just 2.3% in September, down from 3.1% in August, as consumers tightened budgets before the crucial festive season. Food sales grew 4.3% year-on-year, but non-food items gained only 0.7%, and card spending fell 0.7%, according to Barclays. Retailers are warning that higher taxes and continued inflation could dampen Christmas trading.

4. Mortgage rates edge higher, luxury market cools
Average mortgage rates rose for the first time since February, with two-year deals now averaging 4.98%. Lenders expect possible property tax reforms in the Budget, including a new annual levy to replace stamp duty. In London’s prime property market, agents say ultra-rich buyers are leaving due to tougher tax rules but keeping their homes, expecting to return once policies change.

5. Family firms show optimism amid uncertainty
Research from PwC found that 79% of UK family businesses expect to grow over the next two years — well above the global average of 73%. Two-thirds expanded last year, and one in six plan to use AI to accelerate growth. PwC said privately owned firms remain vital to the UK economy’s stability.

6. Cybersecurity incidents surge 50%
The National Cyber Security Centre handled 429 incidents in the year to August, nearly half classed as “nationally significant” and 18 as “highly significant.” The rise highlights mounting threats to government and business, with MI5 warning of espionage targeting MPs and corporate leaders. Cybersecurity consultants are reporting a wave of new demand as firms strengthen defences.

7. Markets uneasy as global trade tensions flare
Global equities retreated after China imposed new restrictions in its trade dispute with the US. UK shares fell following weaker jobs data, and the pound slipped to $1.3253. Andrew Bailey of the Bank of England warned that global debt vulnerabilities could trigger “disorderly adjustments” in financial markets.

Market snapshot (plain English)

Equities:
Stocks across Europe and the US fell on Tuesday as US–China trade tensions intensified. London’s FTSE followed global peers lower after weak jobs data.

Commodities:
Silver hit a record $52.21 per ounce, eclipsing its 1980 high, amid supply shortages in the UK and a London price premium over New York. Gold held firm near recent highs, while oil prices slid to around $63 a barrel on expectations of record global oversupply next year.

Currencies:
The pound weakened to two-month lows against the dollar, while the greenback strengthened broadly as investors sought safety. Money markets now expect a small Bank of England rate cut before year-end.

Sentiment:
Investors remain cautious — worried about trade disruptions, weaker UK data, and uncertainty over the upcoming Budget’s tax implications.

CPA membership insight

Small firms trading on credit face a delicate balancing act. With taxes rising, demand softening, and customers tightening their belts, prompt payment discipline is more vital than ever.
Join The Credit Protection Association to strengthen your cashflow, recover overdue debts professionally, and safeguard your business as economic pressures mount.

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

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