Business news 22 August 2025
SMEs remain confident. Consumers confident. Job cuts, pensions, mortgages, Gov borrowing, output rises, markets, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
😀SMEs remain confident
According to a new report from eBay UK, 78% of online SMEs anticipate growth in the next year, with a third saying they feel “very confident.” The report highlights a shift towards digital-first businesses, with many launching with minimal capital. The poll shows that 44% started with less than £1,000 and 3% launched with no capital at all. AI is seen as a vital tool, with 43% of SMEs excited about its potential. Eve Williams, general manager of eBay UK, said entrepreneurial businesses are “ambitious and adaptable.”
☺️Consumers confident
UK consumers are the most optimistic about their household budgets in 12 months, according to a survey, due to the Bank of England’s interest rate cuts. GfK’s index tracking sentiment around personal finances rose to 5 in August, and the overall consumer confidence measure improved to -17, the best reading since December. The recovery in households’ confidence in their own balance sheets to levels last seen in August 2024 suggests that the BOE’s efforts to ease borrowing costs are finally feeding through to the real economy, a year after officials started cutting interest rates from 16-year highs. Mortgage costs are also edging lower, in a boost for prospective homebuyers. GfK’s Neil Bellamy warned that sentiment improvements remain vulnerable due to “many clouds on the horizon” including inflation and rising unemployment.
📒Job cuts escalate as firms struggle
The private sector has seen job cuts for 11 consecutive months, with this largely attributed to the £25bn increase in employer National Insurance. A report by S&P Global shows that employment numbers fell sharply in August, with businesses struggling under rising hiring costs. Chris Williamson, chief business economist at S&P Global, said: “Payroll numbers… continue to be cut at an aggressive rate by historical standards.” The Recruitment and Employment Confederation noted a 9.2% drop in new job postings in July.
👷Physical workers at risk from pension age rethink
Experts warn that raising the state pension age to 70 could disproportionately affect those in physically demanding jobs, flagging that workers such as carers, warehouse staff, and miners may struggle to continue working into their late sixties. Dr Suzy Morrissey from the Pensions Policy Institute is reviewing the retirement age at the request of Work and Pensions Secretary Liz Kendall. Sir Steve Webb, a former Pensions Minister, said: “Not everyone finds it equally easy to work up to that age.”
🏦Average five-year fix falls below 5%
The average rate on a five-year fixed mortgage has fallen to 4.99%, marking the first time that it has dropped below 5% since May 2023. Data from financial information service Moneyfacts also shows that the average two-year fixed rate mortgage, which last week fell below 5% for the first time since September 2022, has now fallen to 4.97%. Adam French, head of news at Moneyfacts, said: “The slow and steady fall in the cost of borrowing over the last year combined with strong average earnings growth has helped to marginally boost affordability for many homeowners and homebuyers.” Analysis by UK Finance shows that 900,000 fixed rate deals are due to expire in the second half of 2025.
📒Government borrowing falls below OBR forecast
Office for National Statistics (ONS) data shows that Government borrowing – the difference between public spending and income – stood at £1.1bn in July. This was down on the £2.3bn recorded last July and below the Office for Budget Responsibility’s £2.6bn forecast. The total deficit has risen to £60bn since April, with this £6.7bn more than in the same four-month period of 2024. Tax receipts rose by £6.1bn to £77.6bn on the back of higher income tax and National Insurance revenues, while total public spending rose to £92.1bn last month. Chief Secretary to the Treasury Darren Jones said officials are “driving down government borrowing,” as “far too much taxpayer money is spent on interest payments for the longstanding national debt.” Dennis Tatarkov, senior economist at KPMG UK, said the upcoming Budget is “likely to focus on addressing any potential shortfall against current fiscal targets, which we estimate at £26.2bn.” Alex Kerr, UK economist at Capital Economics, suggested that the Chancellor will probably need to raise taxes by £17bn to £27bn to bring down government debt.
📈Output growth picks up pace
Private sector output has grown at its fastest pace since August 2024, according to the UK Composite PMI from S&P Global. The index hit 53.0 in August, up from 51.5 in July on a scale where a figure over 50 indicates expansion. The growth was driven by a rebound in the services sector. Chris Williamson, chief business economist at S&P Global Market Intelligence, said the data shows that economic growth “has continued to accelerate over the summer after a sluggish spring.” However, he warned that confidence among businesses remained “uneven and fragile.”
📈Markets
📈Yesterday, the FTSE 100 closed up 0.23% at 9309.20 and the Euro Stoxx 50 closed down 0.19% at 5462.16. Overnight in the US the S&P 500 fell 0.4% to 6370.17 and the Composite NASDAQ fell 0.34% to 21100.31. The S&P 500 has fallen for five consecutive sessions and is now about 1.5% below its record high.
Global equity markets delivered a mixed performance on Thursday as investors weighed fresh economic data. Major European exchanges oscillated between gains and losses, while US stocks extended recent weakness with a modest pullback. All markets are focused this morning on Fed Chair Jerome Powell’s Jackson Hole speech later today, with investors scaling back expectations for imminent rate cuts. Money markets are pricing in a 73% chance of a September rate cut.
US Unemployment Claims totaled 235,000 for the week ending Aug. 16, up 11,000 from the prior period and higher than the consensus estimate for 225,000. It was the highest level since June 21 though still within the range of the past few years. Continuing claims, which run a week behind, rose to 1.97 million, an increase of 30,000 and the highest level since Nov. 6, 2021.
💱This morning on currencies, the pound is currently worth $1.3413 and €1.1566. The dollar has climbed to a two-week high ahead of Powell’s Jackson Hole speech.
On Commodities, 🛢️Oil (Brent) is at $67.55 & 💰Gold is at $3329. Oil is on track for its biggest weekly gain since early July as hopes for an immediate Russia-Ukraine peace deal have receded. Gold remains steady as traders lower rate-cut bets ahead of Powell’s speech.
📈On the stock markets, the FTSE 100 is currently up flat at 9305.62 and the Eurostoxx 50 is up 0.3% at 5478.
UK economic data surprised to the upside, with the latest purchasing managers’ survey rising to 53.0 in August – its highest reading in a year – compared with 51.5 in July. Consensus forecasts had pointed to only a marginal improvement. Growth in new business reached its strongest pace since October 2024, though the labour market remained fragile, with employment falling for the eleventh consecutive month at a sharp rate.
The UK Flash PMIs for August have surprised to the upside, with the services sector index hitting a 12-month high. Using data from surveys of purchasing managers in the sectors during the past week, the UK composite PMI index to 53.0 from 51.5, also a 12-month high.
This was down to the dominant services PMI also hit a 12-month high at 53.6, up from 51.8 and above the 51.8 expected. Manufacturing remained weak, with the headline manufacturing PMI falling to a three-month low of 47.3 from 48.0 and with a rise to 48.3 having been expected, while the manufacturing output index held steady at 49.5.
The United States and European Union have announced that the framework deal on trade, including on drugs, chips, agriculture and automobiles, has now been agreed.
This adds to a deal struck by Donald Trump and European Commission President Ursula von der Leyen last month. Washington has agreed to cap tariffs on pharmaceuticals, semiconductors and lumber at 15%, while Brussels will eliminate tariffs on industrial goods and widen preferential access for US agricultural and seafood products.
🏭Government takes control of steelworks
Speciality Steels UK (SSUK), the UK’s third-largest steelworks, has been placed under Government control after the High Court granted a compulsory winding up order sought by creditors. The company, which is part of Liberty Steel, will be placed in the hands of the Official Receiver and managers from consultancy firm Teneo. The Government will cover the ongoing wages and costs of the plant while a buyer is sought. Liberty Steel’s chief transformation officer, Jeffrey Kabel, said the decision to put the firm into compulsory liquidation was “irrational,” adding: “We are by far the best company to run this business.” Lawyers for Sanjeev Gupta, CEO and chairman of Liberty Steel parent company GFG Alliance, had applied for an adjournment to allow time to place the company in a pre-pack administration and then immediately buy it out.
💰Stealth raid could add £7k to tax bills
Britain’s high earners would see thousands added to their tax bills if Chancellor Rachel Reeves opts to extend the freeze on income tax thresholds in the Budget. Analysis from wealth manager Rathbones shows that those earning over £100,000 would face an extra £7,000 in income tax if the freeze is maintained. For those earning £80,000, the additional tax burden would be £5,635, while those in the £50,000 bracket would pay £4,632 more. Extending the freeze on income tax thresholds – which is currently set to expire in 2028 – would also pull 1.4m people into the highest rate bracket, which captures those earning over £125,140 a year. Suggesting that the freeze on income tax thresholds “could be dragged out further” as the Chancellor looks to “plug the nation’s financial black hole,” Rathbones’ Ade Babatunde said: “It’s taxation by stealth: the rates stay the same, but a bigger slice of your pay disappears into the taxman’s coffers.”
💼Chancellor faces tax hikes
Experts say Chancellor Rachel Reeves will have to consider tax increases in the upcoming Budget, despite a drop in Government borrowing in July. With economists warning that public finances remain weak, Elliott Jordan-Doak from Pantheon Macroeconomics said: “We think the Chancellor will need to resort to sin and stealth tax hikes, duty increases, and a pensions tax raid in order to meet her fiscal rules if she wants to meet her pledge of keeping headline tax rates unchanged.” Matt Swannell, chief economic advisor to the EY Item Club, said: “Ultimately, it will be the Office for Budget Responsibility’s projection for borrowing over the coming years, not solely this year, that will determine whether the Government meets its fiscal target, and doing so will very likely require tax rises at the autumn Budget.”
🏬WH Smith declares accounting blunder
Retailer WH Smith has admitted to an accounting error that saw an overstatement of around £30m of expected headline trading profit in its North America division. The firm said profit in North America would be revised down to £25m, from previous market expectations of £55m, with this cutting overall pre-tax profit to £110m. WH Smith said the issue, which was identified in a financial review, was “largely due to the accelerated recognition of supplier income.” The firm has instructed Deloitte to “undertake an independent and comprehensive review.” AJ Bell investment analyst Dan Coatsworth said the incident was “nothing short of a disaster,” while Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: “Getting it so wrong is not a good look.” JPMorgan analysts said the matter “raises a number of issues” around the retailer’s accounting.
🚨Latest Insolvencies
Petitions to wind up (Companies) – SERALI LIMITED
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Appointment of Liquidators – BIZCLOUD SOLUTIONS LTD
Appointment of Liquidators – R. PURCELL CIVIL ENGINEER CONTRACTORS LIMITED
Appointment of Liquidators – MAXDOP LTD
Petitions to wind up (Companies) – THE GRAND PORTOBELLO LTD
Appointment of Liquidators – B.S. (DEVELOPMENTS) LIMITED
Appointment of Liquidators – VISIONEER ANALYTICS LTD
Appointment of Liquidators – SKY INTERNATIONAL OPERATIONS LIMITED
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Petitions to wind up (Companies) – MID-AIR SITE SERVICES LIMITED
Petitions to wind up (Companies) – OVAL NEWS RETAIL LTD
Petitions to wind up (Companies) – AMEDICA GROUP LTD
Petitions to wind up (Companies) – KVS CONVENIENCE STORE LTD
Petitions to wind up (Companies) – PGO GLOBAL SUPPLY CHAIN LIMITED
Petitions to wind up (Companies) – ANBO TEXTILES LIMITED
Petitions to wind up (Companies) – CLAYLENS MILLS LTD
Petitions to wind up (Companies) – WRIGHTS BIOMASS SERVICES LIMITED
Appointment of Liquidators – W2WAVE LTD
Appointment of Liquidators – THE QUARR GROUP HOLDINGS LIMITED
Appointment of Liquidators – THE QUARR GROUP LIMITED
Appointment of Liquidators – PYLLE MOTORS LIMITED
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Petitions to wind up (Companies) – UK SALON DESIGN LTD
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➕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.