Business news 28 August 2025
UK services sector faces grim outlook. UK unemployment rate set to rise. Minimum wage hike threatens ambition. AI fears grip UK workers, Plus Taxes, house prices, markets, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
🏢UK services sector faces grim outlook
Business confidence in the UK’s services sector has significantly declined, according to the latest CBI survey. Companies are facing profit squeezes due to rising costs and falling sales, leading to reduced hiring and investment. Alpesh Paleja, deputy chief economist at the CBI, said the survey “painted a grim picture of the services sector.” The negative outlook has persisted for eight months among consumer services firms, while those serving other businesses reported declining activity for four months.
📈UK unemployment rate set to rise
The UK’s unemployment rate is projected to reach 5% by August, according to the Resolution Foundation. The Office for National Statistics (ONS) reported a current rate of 4.7%, matching the previous quarter’s high. Job vacancies have also declined, with 718,000 openings recorded, the lowest since April 2021. Gregory Thwaites, research director at the Resolution Foundation, stated: “Our alternative unemployment rate indicates that unemployment has not yet peaked.”
💷 Minimum wage hike threatens ambition
Steve Rigby, co-CEO of Rigby Group and chair of Family Business UK, warns that rising minimum wages are undermining graduate salaries and ambition in the UK. The Low Pay Commission’s (LPC) recent decision to increase the minimum wage by 6.8% has created a scenario where non-skilled jobs may soon pay as much as graduate roles. Rigby argues that this trend could lead to a brain drain, as talented individuals opt for immediate employment over further education. He points to the need for the LPC to consider broader economic factors in wage policy to avoid jeopardising the UK’s competitive edge and social mobility.
🅰️ℹ️AI fears grip UK workers
The Trades Union Congress (TUC) reports that over half of UK adults fear artificial intelligence (AI) may threaten their jobs. A recent survey revealed that 51% of working adults are anxious about AI’s impact, with concerns peaking among younger workers aged 25 to 34, where 62% expressed worry. TUC assistant general secretary Kate Bell commented: “AI could have transformative potential… Left unmanaged… the AI revolution could entrench rampant inequality.” The TUC urges companies to invest in workforce skills to prevent job displacement as AI technology evolves.
🔋UK invests £500m in battery storage
The National Wealth Fund has partnered with Equitix and Aware Super for a £500m investment in the UK’s battery storage sector. The consortium aims to build, own, and operate grid-scale battery storage assets through Eelpower Energy. The Chancellor said the initiative will help reduce energy bills and create jobs while Energy Minister Michael Shanks pointed to its role in the Government’s Clean Power mission.
📈Markets
📈Yesterday, the FTSE 100 closed down 0.11% at 9255.50 and the Euro Stoxx 50 closed up 0.17% at 5393.07. Overnight in the US the S&P 500 rose 0.24% to 6481.40 and the Composite NASDAQ rose 0.21% to 21590.14.
The S&P 500 and Nasdaq 100 reached all-time highs on Wednesday before Nvidia’s earnings release. However, stocks fell in late trading Wednesday after Nvidia’s revenue forecast failed to meet elevated expectations. In after hours trading though Nvidia release a lackluster earnings forecast showing decelerating growth (sales still grew 56). So despite saying sales would be $54 billion in the 3rd quarter, concerns were fueled regarding the future of AI spending. The stock, which is up 35% this year after almost tripling in 2024, slipped in extended trading as data center revenue came up short of estimates for the second straight period.
💱This morning on currencies, the pound is currently worth $1.3498 and €1.1594.
On Commodities, 🛢️Oil (Brent) is at $67.50 & 💰Gold is at $3401.
📈On the stock markets, the FTSE 100 is currently down 0.21% at 9236 and the Eurostoxx 50 is up 0.42% at 5415.
European markets are higher as investors digest Nvidia’s earnings. The Stoxx 600 has nearly closed its year-to-date performance gap with the S&P 500.
🏠Treasury considering adding National Insurance to landlords’ rental income
The UK Treasury is considering a proposal to increase revenue by applying National Insurance (NI) contributions to landlords’ rental income. The measure, supported by some Labour MPs and think tanks, aims to generate approximately £2bn and address a potential £40bn deficit in public finances. Applying an 8% levy on the £27bn net property income recorded in 2022-23 could yield significant revenue. However, concerns exist that a £50,000 earnings threshold, similar to that for employees, could disproportionately affect smaller landlords, potentially increasing their annual tax burden. Nearly one in five Britons rents from private landlords, totalling 2.2m individuals receiving property income. The Resolution Foundation previously suggested this plan, which was deferred but is now being reconsidered due to growing fiscal challenges, exacerbated by rising borrowing costs. Critics caution that the imposition of NI on rental income could prompt landlords to sell their properties, thereby reducing the lettings market and potentially raising rents.
💼Don’t fiddle with niche edges of the tax system
As speculation mounts about the upcoming autumn Budget, Tim Sarson, head of tax policy at KPMG UK, highlights in CityAM the challenges facing the Chancellor regarding tax changes. With no talk of tax cuts, the focus is on potential increases. Sarson notes that UK tax receipts primarily come from income tax, national insurance, and VAT. He warns against minor adjustments to niche taxes, which could provoke backlash from interest groups. “Most people agree with the principle that those with the broadest shoulders should bear the largest burden. The trouble is there aren’t many of them. Sometimes you just need lots of shoulders.”
City AM
🏠House price growth hits the brakes
House price growth in the UK has slowed, with average prices rising by 1.3% over the year to July, according to Zoopla. The increase is below the current inflation rate of 2.1%. The average home price now stands at £270,600, reflecting a £3,560 rise from last year. Increased housing supply has led sellers to lower asking prices. Speculation about potential changes to property taxes may also cause buyers to postpone decisions until after the autumn Budget. Zoopla noted: “More homes on the market means sellers are inclined to keep asking prices lower.”
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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.