UK Industry Fast Facts

IBISWorld presents a collection of fast facts for the different sectors of the UK economy.

Agriculture, Forestry & Fishing

• In the Autumn Budget 2024, the government introduced a £1 million limit on the inheritance tax relief for farms from April 2026, after that there would be a 50% relief, at an effective rate of 20%. The National Farmers’ Union (NFU) of England and Wales has labelled the Budget as “a blow to British farmers and could lead to food price rises.” Farmers warn that these measures might force them to sell their farms, while there are also worries that the tax could discourage investment in green farming technology.  

• The ADHB warned that from April 2026, the average farm valued at £2.2 million, would face an inheritance tax of £240,000. This has sparked a wave of protests, most recently a tractor rally organised by Save British Farming on 10 February 2025, held outside Parliament in London. This rally coincides with a parliamentary debate over an e-petition signed by over 148,000 people, which calls for the retention of current inheritance tax exemptions for working farms. However, the Labour government stays firm with its tax reform, asserting it’s a “fair and balanced approach which helps fix the public services we rely on”.

• Labour also announced an accelerated reduction in the Rural Payments Agency’s delinked payments, which support production on many farms. The government plans to cut base payments by at least 76% in 2025, which will harm farmers' livelihoods and negatively impact output.

• DEFRA reports that farming contributes about 12% of the UK's total greenhouse gas emissions. The NFU warns that achieving net-zero farming by 2040 is unlikely without increased investment in climate-friendly measures. The current government has kept the 2025-26 climate-friendly farming budget at £2.4 billion, unchanged from the previous level.

• The UK government launched a new Land Use Framework consultation, requiring the conversion of 760,000 hectares (about 9% of England's farmland) to low-carbon uses like woodland and heath by 2050 to meet climate targets. The NFU warns this could increase dependence on imported foods. However, the government claims that advancements in technology and sustainable farming will offset any impact on food production by boosting crop yields.

• Steve Reed, the DEFRA Secretary, has expressed his support for a potential UK-US trade deal, even amid concerns from British farmers regarding the risk of cheaper American imports outcompeting local produce. As reported by Farmers Weekly, Mr Reed insists that a "fair" trade agreement can boost the UK economy while safeguarding the interests of domestic agriculture.

Mining

• The Office for National Statistics reports that the mining and quarrying sector output declined by 1.5% in December 2024, continuing its longer-term downward trend. Output from the sector dipped by 2.5% in the three months to December 2024. Mining and quarrying output contracted by 7.2% in 2024, the largest negative contribution of any sector.

• World Bank Commodities Price Data released in January 2025 shows that the annual average prices for coal and crude oil fell in the period January to December 2024 compared with the same period in 2023. Metals and minerals annual average prices have been mixed, with aluminium, copper, tin and zinc prices climbing, while iron ore, lead and nickel prices falling. Within precious metals, gold and silver recorded a hike in prices, while platinum dipped slightly over the year.

• Gold has seen its price soar in recent years — this has continued strongly in 2025, reaching new highs. According to The Royal Mint, gold prices reached over £2,300 per ounce in February 2025 amid positive investor sentiment for the safe haven asset given economic uncertainty and higher central bank demand.

• Following a case by environmental group campaigners, including Greenpeace, a court has ruled that the approval for the Rosebank and Jackdaw oil and gas fields was unlawful and the owners, including Shell and Equinor, must seek fresh approval to extract oil and gas.

• The Guardian reports that a further 13 oil and gas licences could be scrapped following a court’s decision to rule that the approval for the Rosebank and Jackdaw oil and gas fields was unlawful.

• According to BDO’s Annual Mining Report 2025, demand for critical minerals from clean energy technologies is forecast to triple by 2030 and quadruple by 2040.

• The director of the UK Critical Minerals Intelligence Centre, Gavin Mudd, has said that new mines and stockpiling are needed to avoid supply shortages of critical minerals.

• The National Wealth Fund has announced a £28.6 million investment in the reopening of the South Crofty tin mine in Cornwall. BBC reports the scheme is expected to create over 300 jobs.

• The Financial Times reports that the total cost of the Sizewell C nuclear power station is estimated to reach £40 billion, double the £20 billion projected in 2020 by developer EDF and the UK government.

Manufacturing

• In January 2025, the S&P Global UK manufacturing PMI edged up to 48.3 from December’s 11-month low of 47. However, the manufacturing sector continued to contract for the third consecutive month. New orders declined, reflecting sluggish demand from both domestic and overseas markets amid low investor sentiment. Employment levels remained uncertain as job losses accelerated at the fastest rate in nearly a year. Meanwhile, input and output prices surged, with purchase price inflation hitting a two-year high due to ongoing supply chain disruptions and regulatory challenges.

• AstraZeneca pulled the plug on its £450 million investment to expand a vaccine manufacturing plant in Merseyside on 31 January 2025, citing insufficient government support. This move came just two days after Chancellor Rachel Reeves outlined Labour's plan to accelerate economic growth.

• Car manufacturers must meet a government mandate requiring 28% of sales to be electric vehicles (EVs) by the end of 2025, with a £15,000 fine per non-compliant car. In 2024, EV sales increased to 19.6% (381,970 cars), up from 16.5% in 2023, but fell short of the 22% target for that year. No fines were imposed. In January 2025, the Society of Motor Manufacturers & Traders reports that electric vehicles (EVs) represent over a fifth of new car registrations. However, their market share still doesn't meet the mandated target, prompting calls to relax the requirements.

• In 2024, BAE Systems, the UK's largest weapons manufacturer, achieved record orders and over £3 billion in profit as European defence spending surged due to the Russia-Ukraine conflict. Looking ahead, the company anticipates sales to surpass £30 billion in 2025.

• In February 2025, IONETIC, a software-accelerated battery pack developer, announced plans for a £5 million smart battery production pilot facility in Brackley, Northamptonshire, called Arc Fab Pilot. Expected to be fully operational by Q3 2025, this facility aims to significantly reduce time-to-market and development costs for electric vehicles, marking a major advancement in EV technology.

• On 16 February 2025, the Business Secretary launched the Plan for Steel Consultation, which addresses long-term issues in the industry including high electricity costs, unfair trading practices and scrap metal recycling, aiming to protect industrial jobs and support key industrial regions. With up to £2.5 billion allocated from the National Wealth Fund, the plan focuses on boosting steelmaking to support UK manufacturing, construction and infrastructure sectors.

• According to the Business and Trade Secretary, Jonathan Reynolds, if the US impose hefty import taxes on British steel and aluminium, the UK will respond with tariffs on US products like whiskey, jeans and motorbikes. While US tariffs pose a potential threat, Reynolds believes “there’s a basis for constructive engagement” between the UK and US to prevent this from happening.

• UK manufacturers are urging the government to implement an effective industrial strategy in response to rising labour costs from Chancellor Rachel Reeves' tax hikes in the Autumn Budget. According to a Financial Times survey, 90% of senior manufacturing executives reported that employment costs would be their largest expense in 2025-26.

• According to the ONS, monthly production output was estimated to have increased by 0.5% in December 2024, following falls in October and November (down 0.6% and down 0.5%, respectively). Out of 13 subsectors, seven contributed to this growth. The most significant positive impacts came from the basic pharmaceutical products, machinery and equipment and other manufacturing and repair sectors. Production output for Q4 2024 was estimated to have dropped by 0.8% compared with Q3 2024, which is the fifth consecutive quarterly decline in production output.

Utilities

• Starting January 2025, the energy price cap will climb by 1.2%, reaching £1,738 annually for a typical household, as announced by Ofgem. This hike intensifies the financial strain on households. Analysts from the energy consultancy, Cornwall Insight, forecast energy prices will rise by 5% from April 2025, adding £85 a year to household bills.  
• The UK water regulator Ofwat will allow utilities in England and Wales to raise customer bills by an average of 26% by 2030. In 2025, household water bills in England and Wales are set to surge by an average of 26% to £603, the largest annual increase since privatisation 36 years ago. Notably, Southern Water customers will experience the steepest increase among the 11 water companies, with bills expected to climb by 47%, as reported by Water UK.
• Thames Water, along with five other companies — Anglian Water, Southern Water, Northumbrian Water, Wessex Water and South East Water — have appealed to Ofwat to reconsider its price determinations through a review by the CMA. They are seeking approval to raise customer bills beyond the current limits set for the end of the decade. The companies argue that the current allowed increases are insufficient to fund crucial infrastructure investments.
• On 18 February 2025, the High Court approved a £3 billion emergency loan for Thames Water, described by Chief Executive Chris Weston as providing "a firmer financial footing". This loan, carrying a 9.75% interest rate, along with additional fees, will help the company manage its debt and prevent renationalisation, securing necessary funds until October 2025. However, critics caution that this "liquidity extension" could hike customer bills by £250 annually. Despite these concerns, the financial support will enable Thames Water to continue investing in its network and deliver essential infrastructure upgrades.
• Southern Water also announced plans to raise £900 million in equity to protect its credit rating and support its investment programme for the 2025 to 2030 regulatory period on 18 February 2025.
• EDF Energy announced an extension for four ageing UK nuclear power stations to enhance energy security. Hartlepool and Heysham 1, originally set to close in March 2026, will now operate until March 2027, while Heysham 2 and Torness, planned for closure in 2028, will remain open until 2030. These extensions aim to compensate for delays in the Hinkley Point C power plant, now expected to be operational in 2029, at the earliest.
• In February 2025, a Cornwall Council planning committee approved plans for a 5,000-panel solar farm near Hayle, despite concerns about flooding. This solar farm will supply renewable electricity to the nearby St Ives Bay Holiday Park via an underground cable and is expected to operate for 40 years.
• The Scottish government has pledged an additional £25 million to establish a Grangemouth Just Transition Fund, supporting a sustainable future for the Grangemouth oil refinery complex, which is scheduled to close in the summer of 2025.

Construction

• The latest S&P Global release reveals that the UK Construction PMI dropped sharply to 48.1 in January 2025, down from 53.3 in December 2024, indicating a contraction in growth. This slump is due to client delays on major projects and broader economic uncertainty. House building fell for the fourth consecutive month, civil engineering activity decreased rapidly and commercial construction contracted. New orders also dropped for the first time in a year. Input price inflation surged to its highest rate since April 2023, undermining business confidence.
• The updated National Planning Policy Framework (NPPF) sets a clear target of building 370,000 homes annually and reinstates mandatory goals for local authorities. The Green Belt has also been revised to include a ‘grey belt’, encouraging development on low-grade greenbelt land. However, BBC’s housing tracker reports a 10% decline in new homes in England during the first six months of Labour's parliament, with approximately 107,000 new homes built since July's election.
• According to the Financial Times, over 100 locations in England have expressed interest in being selected as one of approximately 12 new towns. Prime Minister Keir Starmer has announced that construction on these towns is expected to begin before the end of his parliamentary term. This initiative aims to boost housebuilding activity across the country.
• Real estate developers are flooding into the UK student housing sector, with a record number of deals in 2024. This surge occurs despite a decline in international student numbers and ongoing financial uncertainty in the higher education sector. A Knight Frank report indicates that private developers signed 22 land deals in the purpose-built student accommodation market in 2024, totalling £473 million.
• With rising building costs and high mortgage rates impacting construction output, the construction sector leads the latest UK insolvencies list, according to the Insolvency Service. In 2024, around 4,032 building businesses became insolvent, accounting for 17% of all cases in England and Wales.
• Data from the Department for Business and Trade indicates that overall material price inflation fell by 0.5% in December 2024, compared to the previous month and saw a slight annual dip of 0.1%. Despite this, material prices for New Housing registered a 1.3% increase, Repair and Maintenance edged up by 1% and Other New Work decreased by 1.4% in the 12 months to December 2024. Other builders’ ironmongery and precast concrete, including blocks, bricks, tiles and flagstones, saw the largest annual increases at 9.5% and 6.7%, respectively.

Wholesale Trade

• According to the Office for National Statistics, output in the wholesale and retail trade and repair of motor vehicles and motorcycles fell by 1.7% in December 2024, the largest negative contributor to consumer-facing services. However, the largest positive contribution to services in December 2024 came from wholesale trade, except of motor vehicles and motorcycles (up 1.5%).
• The Federation of Wholesale Distributors (FWD) has coordinated a letter to the Prime Minister, signed by its member wholesalers. The letter highlights budget concerns about the National Living Wage increase and the rise in employer National Insurance, which together will add an additional estimated £141 million per year in costs to an already struggling sector.
• At the end of January 2025, JJ Foodservice reported it is to expand its scope and strengthen its offering for caterers through new acquisitions in the foodservice sectors. It seeks to expand into new categories and cuisines to meet evolving customer needs.
• The Going for Growth report by Capital Economics and commissioned by the FWD has found that food and drink wholesalers recorded turnover of £33.6 billion in 2023-24 (including £17.5 billion coming from sales to mainly small independent retailers and £13.4 billion to foodservice providers and caterers), providing direct employment for 77,000 people. In terms of gross value added, wholesalers directly contributed £3.5 billion to UK output, highlighting the important role the sector plays in the economy. 

Retail Trade

• CPI inflation rose sharply by 0.5 percentage points to 3% in January 2025, exceeding market expectations of 2.8% and kicking off another year of rising inflation, compounding financial pressures for low and middle-income households. While the inflation rate of clothing and footwear increased, extensive discounting by retailers saw prices decreasing significantly on the month. The same was true for furniture and household equipment, which despite decreasing in price on the month, returned to inflation for the first time in 10 months, according to the British Retail Consortium.

• UK total retail sales increased by 2.6% year on year in January 2025, against a growth of 1.2% in January 2024. This was above the three-month average growth of 1.1% and above the 12-month average growth of 0.8%. Food sales increased by 2.8% year on year in January 2025, against a growth of 6.1% in January 2024. This was above the three-month average growth of 2.3% and below the 12-month average growth of 3%. Non-Food sales increased by 2.5% year on year in January 2025, against a decline of 2.8% in January 2024. Consumers headed to the shops to refresh their homes for the year ahead, taking advantage of big discounts on furniture, bedding and other home accessories. With growth across nearly all categories, only toys and baby equipment remained in decline.

• Retailers anticipate a spending squeeze as consumer confidence remains glum. According to BRC-Opinium data, consumer expectations over the next three months of their personal financial situation fell to -4 in January 2025 from -3 in December 2024, while the state of the economy worsened to -34 in January 2025, down from -27 in December 2024 and -19 in November. The public’s spending intentions dropped six points, with expectations of spending in nearly every retail category falling.

• Retail crime – particularly retail losses from theft – remains rampant. Retail crime is at its highest level on record, according to new figures released today from the British Retail Consortium’s Annual Crime Survey. Theft also reached an all-time high with over 20 million incidents (over 55,000 per day) costing retailers £2.2 billion in 2023-24 (up from £1.8 billion the previous year).

• Retailers voiced concerns over the £7 billion new costs introduced by the Budget. Two-thirds of Chief Financial Officers (CFOs) reported they are left with little choice but to increase prices (67%) and reduce investment in jobs and shops thanks to higher employer national insurance contributions, National Living Wage and new packaging levy. Additionally, 31% of respondents from the BRC survey noted rising expenses would lead to further automation.

• A survey of CFOs at 52 retailers has revealed significant concern about trading conditions over the next 12 months, according to BRC. 70% of respondents “pessimistic” or “very pessimistic” about trading conditions over the coming 12 months, while just 13% said they were “optimistic” or very “optimistic” (17% were neither optimistic nor pessimistic). The top three concerns are falling demand for goods and services, inflation and the mounting regulatory and tax burden.

• According to new research by the Retail Technology Show, millennials now make more purchases than Gen Z across social media platforms, including TikTok, Instagram and Facebook at 21 purchases over the past year vs 14. As shoppers’ seemingly insatiable appetite for content-led commerce continues to grow, this has given rise to a new cohort of ‘TikTok made me buy it’ consumers, an increasingly valuable shopper segment that retailers want to tap into.

Transportation & Warehousing

• From March 2025, tube and rail fares in London will increase by an average of 4.6%. Nonetheless, Mayor Sadiq Khan has committed to freezing bus and tram fares until 2026, providing some relief for commuters.

• The Air Passenger Duty to go up in 2026-27, by £2 for short-haul economy flights and £12 for long-haul ones, while rates for private jets are set to go up by 50%.

• The Secretary of State for Transport has launched the JetZero Taskforce to tackle aviation emissions. Its focus includes promoting sustainable aviation fuels, advancing zero-emission flights and enhancing aviation systems for greater efficiency. In January 2025, the Sustainable Aviation Fuel (SAF) Mandate became law, mandating that 2% of this year's aviation fuel comes from sustainable sources. Targets are set to rise to 10% by 2030 and 22% by 2040. To support this shift, the Department of Transport announced a £63 million investment for 2025-26 in the Advanced Fuels Fund, aligning aviation expansion with environmental goals.

• The UK government ramps up road repairs with a £1.6 billion investment for 2025-26, fixing potholes and restoring roads in England — a nearly 50% funding boost from the previous year.

• Following Labour’s pledge to nationalise the railway network, the government plans to take South Western Railway into public ownership. In May 2025, the contract held by FirstGroup and MTR will transfer to the DfT’s Operator of Last Resort.

• The government is poised to approve Gatwick Airport's expansion by 27 February 2025, as part of an economic growth initiative, reports the Financial Times. A decision on Luton Airport's expansion is expected by 3 April 2025. In a January 2025 interview with the BBC, Rachel Reeves announced that Heathrow's third runway is expected to open by 2035 and could create 100,000 jobs, as well as stimulate growth.

• Heathrow Airport’s CEO, Thomas Woldbye, has announced the airport’s largest private investment programme to date, which includes the development of a third runway, with plans to be submitted to the government by Summer 2025. The investment aims to enhance existing infrastructure and support the construction of the new runway, ultimately boosting the UK economy. Airport officials are confident that by upgrading current facilities, they can accommodate up to 100 million passengers annually.

• Following the Israel-Hamas ceasefire on 19 January 2025, Houthi militants announced plans to limit attacks on commercial ships, potentially easing maritime trade disruptions and benefitting UK shipping companies. However, threats remain elevated on Red Sea routes for the near future.

• Logicor, a top logistics developer, has completed its biggest UK project in Daventry, Northamptonshire, featuring three warehouses totalling 800,000 sq. ft, which is projected to generate 1,000 jobs.

• The Department for Transport announced that 47 train stations across London and the South East will introduce tap-in and tap-out ticketing, making key commuter routes, like London Bridge, fully contactless starting February 2025. This technology will be introduced at 49 more stations through 2025 to streamline travel.

Accommodation & Food Services

• ONS data reports that output in accommodation and food service activities expanded by 0.02 percentage points in December 2024 and by just 0.01 percentage points in the three months to December 2024. Food and beverage service activities were the largest positive contributor to the growth in consumer-facing services output in December 2024 (at 2%), while accommodation was the second-largest negative contributor. Accommodation and food service activities’ contribution to GDP output grew by just 0.01 percentage points in 2024.
• The hospitality industry trade body, UKHospitality, warns that the industry faces an extra £1 billion in costs amid 774,000 hospitality workers becoming newly eligible for employer national insurance contributions from April 2025. The trade body has called for the government to delay or alter the tax changes announced in the Autumn Budget to help protect jobs in the hospitality industry. The £1 billion cost hike will be on top of £2.4 billion of other costs, like rising wages, due to hit the hospitality sector in April 2025, as reported by The Guardian.
• The GfK consumer confidence index dropped sharply in January 2025, to the lowest level since the end of 2023, due to higher government borrowing costs and fears of job cuts. Lower confidence among consumers may take a toll on spending on accommodation and food service activities.
• The British Beer and Pub Association reveals that 289 pubs closed across England and Wales in 2024, equating to six establishments a week, amid significant cost pressures. These closures have cost 4,500 jobs.
• According to data from the Office for Health Improvement and Disparities, poorer areas in the UK have more than twice the number of fast-food outlets per population than the wealthiest areas, at 147 in poorer areas vs 73 in wealthier areas. Camden, London ranked top in terms of fast-food outlets per 100,000 people.
• Figures from the Night Time Industries Association reveal a 32.7% drop in the total activity of the UK’s nightclub sector, equating to a loss of 405 venues, between March 2020 and November 2024. London recorded the smallest decline, at 19.7%. Nightclubs are set to face further pressure from reduced business rates relief and higher taxes from April 2025. The association states that many nightclubs face £30,000 to £100,000 in extra costs, spelling further trouble for the industry.
• Intercontinental Hotels Group has acquired Ruby Hotels, its 20th brand, for €110.5 million (about £88 million) in February 2025. Founded in 2013, Ruby Hotels has 20 hotels in Europe, three of which in London, with a pipeline for 10 further hotels over the next three years across more European cities and plans for potential expansion into the US by the end of the year.
• Hotel chain OYO has revealed plans to invest £50 million in the UK over the next three years, opening 40 new hotels and supporting 1,000 jobs. The chain has over 200 hotels in the UK, mainly in the budget segment, but it seeks to expand its focus on the premium segment in the UK, as reported by City AM.
• Savills reports that hotel transaction volumes in Scotland reached £431 million in 2024, a 38% hike from 2023. Scotland accounted for the largest share of UK hotel deals outside of London, at around 7.5%.
• VisitBritain estimates 41.2 million inbound visits to the UK in 2024, with £31.5 billion spent. It forecasts 43.4 million visits and £33.7 billion spend in 2025.
• In a bid to boost inbound tourism, the UK Tourism body VisitBritain has launched a global screen tourism campaign called ‘Starring GREAT Britain’ at the end of January 2025. The campaign draws on popular film and TV moments. The idea behind the campaigns comes from the body’s screen tourism research which found that “more than nine-out-of-10 potential visitors to the UK would be keen to visit film and TV locations during a trip”, as reported by UKinbound.

Information

• ONS data reports that output in the information and communication subsector fell by 0.4% in December 2024, the largest negative contribution in the services sector during the month. This was driven by computer programming, consultancy and related activities, which fell by 1.3%, and publishing activities, which fell by 5.7%. This was partially offset by growth of 8.4% in the motion picture, video and TV programme production, sound recording and music publishing activities industry. Information and communication’s contribution to GDP output in 2024 increased by 0.05 percentage points.
• The boss of TV broadcaster Channel 4, Alex Mahon, has warned that social media platforms operating in the UK should be forced to promote news content from trusted sources. More people in the UK receive most of their information and news from social media platforms than traditional sources, potentially leaving them exposed to disinformation.
• In February 2025, Ofcom published proposals for upper 6 GHz spectrum to be made available and shared between mobile and Wi-Fi services. It says that “this new spectrum would provide a large increase in capacity for both mobile and Wi-Fi services, laying the foundations for future generations of data-hungry technologies, such as virtual and augmented reality and AI”.
• The government is set to invest £20 million into Anglo-Danish rocket maker Orbex, as per the Financial Times. This will be in the form of a loan to fund “the company’s small launcher through to lift-off in Scotland” in 2025. The investment would make the government a shareholder in the company.
• Research by Enders Analysis has found that altnets recorded collective losses of about £1.3 billion in 2023 and this figure likely worsened in 2024 amid rising interest costs.
• Telecoms.com reports that EXA Infrastructure has been picked by IOEMA as the leading partner for its new submarine cable in Leiston, UK. Launched in May 2024, the IOEMA project is a 1,600km high-capacity submarine fibre optic network which will aim to strengthen connectivity in Northern Europe by linking the UK, Netherlands, Germany, Denmark and Norway.
• The Competition and Markets Authority (CMA) has launched an investigation into tech giant Google’s position in search and advertising activities in the UK to determine whether its services “are delivering good outcomes for people and businesses in the UK”.
• The CMA has ruled that Microsoft has used its software dominance to stifle competition in the cloud services market in the UK. The regulator states that the lack of competition in cloud services was “likely to be leading to higher costs, less choice, less innovation and lower quality of service for businesses and organisations”, reports The Financial Times.

Finance & Insurance

• The Economic Crime and Corporate Transparency Act 2023, effective 1 September 2025, introduces a ‘failure to prevent fraud’ offence, creating new legal risks for firms. This strict liability offence targets 'large organisations' with at least two of these criteria: over 250 employees, more than £36 million turnover, or over £18 million in assets. Firms outside this scope should still reassess fraud prevention measures, anticipating possible regulatory expansion. The Financial Conduct Authority is expected to urge supervised firms to strengthen fraud controls in line with this legislation.

• The Prudential Regulation Authority released Policy Statement SS11/24 on solvent exit planning, requiring firms to align with its guidelines by 30 June 2026. The objective is to ensure insurance firms have clear plans for an orderly solvent exit, protecting policyholders and financial stability. Firms must establish robust exit strategies, considering capital, governance and operational risks. Compliance is required by 30 June 2026, reducing market disruption risks.

• Figures from GlobalData reveal British consumers are increasingly embracing buy now, pay later (BNPL) plans amid increasing government scrutiny, with activity in the sector climbing to around £25 billion in 2024, an almost 20% increase on the previous year. The BNPL market in the UK has increased tenfold since 2019, driven by a cost-of-living crisis, higher interest rates from other forms of credit and the disappearance of alternative payday loans.

Real Estate and Rental and Leasing

• According to Nationwide, annual house price growth increased by 4.1% in January 2025 compared with January 2024. Prices inched upward by 0.1% month on month and the average house price stood at £268,213. The housing market has remained resilient despite ongoing affordability pressures.

• Zoopla states that new housing sales agreed were up 12% year-on-year in January 2025, highlighting a solid start to the year for the housing market, bolstered by buyers trying to avoid paying higher stamp duty from April 2025.

• Figures from lender Halifax in February 2025 reveal that the number of UK first-time buyers surged by 19% in 2024, to some 341,068 first-time purchases. This signals some improvement in mortgage affordability amid reduced borrowing costs.

• Halifax reported a new record for average UK house prices in January 2025, on the back of the approaching end of a property tax break and resilience amid strained affordability, as reported by the Financial Times.

• A survey by the Royal Institution of Chartered Surveyors (RICS) reveals that estate agents’ outlook was very positive, with expectations of house prices and property sales to climb in 2025.

• A survey by the RICS has found that demand for residential property in the UK has cooled in January 2025, potentially due to the UK government bond sell-off and higher yields.

• Private renters are facing a tough market, especially in the capital. ONS statistics show private rents in the UK climbed by 9% in December 2024, to an average of £1,327 per month. Rents in London surged by 11.5% over the month.

• In a positive sign for the commercial property market, British Land and GIC have agreed to sell half of Citadel’s new City of London office tower to Abu Dhabi’s Modon Holding. The tower at Broadgate is currently under construction. The deal is seen as a sign of “growing international investor confidence in the top end of London’s office market” according to the Financial Times.

• The Duke of Westminster’s property company Grosvenor has sold a £306 million stake in its London Mayfair estate to the Norwegian sovereign fund. This marks the first significant investment by the Norwegian oil fund in the capital since 2018.

Professional, Scientific & Technical Services

• ONS data reports that output in professional, scientific and technical services hiked by 1.2% in December 2024, the largest positive contribution in the services sector. Six out of the eight industries experienced growth in December 2024, with the largest contribution coming from a climb of 3.4% in the advertising and market research industry. Professional, scientific and technical services output increased by 0.9% in the three months to December 2024. For the whole of 2024, professional, scientific and technical services expanded by 3.2%, the largest contribution to growth in GDP output. Seven of the eight industries have grown in 2024, with the largest contribution coming from scientific research and development, despite a fall in December 2024.
• The Financial Times reports that the government is “exploring scrapping promised stricter audit rules for private companies” as it seeks to lessen the burden on companies in an attempt to boost economic growth. It reports that the government is discussing “ditching a measure that would force the Big Four accounting firms to share audits of the largest companies with smaller firms”. Previously, accounting firms have been sceptical of the proposed shared audits, claiming it would hike fees.
• The Financial Reporting Council’s annual Audit Market and Competition Update for 2024 reveals that the challenger audit firms’ share of FTSE350 audit engagements grew from 11% in 2022 to 13% in 2023. However, the Big Four audit firms (Deloitte, EY, KPMG, and PwC) continue to dominate the market, earning 98% of FTSE350 audit fees and 90% of all Public Interest Entity (PIE) audit fees in 2023. Meanwhile, the number of FTSE350 audits supplied by challenger firms has climbed from 4% in 2019 to 13% in 2023.
• A quality inspection on Tier 2 and Tier 3 audit firms released by the FRC in December 2024 has found that 57% of audits were assessed as requiring significant improvements, compared to the average of 33% over the previous four years, which is a cause for concern.
• A UK Accountancy Sector Outlook Report 2024-25 by AccountancyAge and HSBC states that “A significant rise in mergers and private equity activity is expected, driven by the need to scale and diversify”.
• In December 2024, seven regional accounting firms in the East and South East of England have merged to create Affinia (LB Group), a new challenger firm. The merger has been backed by private equity firms Sovereign Capital Partners and brings LB Group together with six other firms – RE Group, Dyer & Co., Giess Wallis Crisp, NSO Associates, Baxter & Co., and Clarkson Hyde. The new group has over 400 employees, 7,000 clients and 9 offices in East and South East of England.
• AccountancyAge has revealed the Top 50+50 Accountancy Firms 2024. According to its rankings, Evelyn Partners has overtaken Grant Thornton’s sixth spot in terms of revenue (£701 million vs £654 million), with much of this growth down to significant acquisition activity. Sumer is also making waves, becoming a challenger in the market as it reports fee income of about £140 million, representing a staggering 605% rise since 2023 thanks to substantial acquisition activity. Highlighting the shift to advisory services, the survey has found that fees from consultancy services have continued to climb across the top 100. In 2024, fee income from consultancy averaged £77.2 million, up from £75.9 million the year before.
• Data from the EU Industrial R&D Investment Scoreboard shows that the number of British companies listed in the global top 2,000 R&D spenders has nearly halved in the decade to 2023, from 118 in 2013 to just 63 in 2023. This points to the difficulties faced by the UK to win the global AI race, as reported by the Financial Times.
• The House of Lords science and technology committee has warned that UK visa rules, including high visa fees and inflexible immigration system, put off science students and early career researchers. The UK’s rules make it less attractive to talent in high-growth areas segments like AI, as reported by the Financial Times.

Education

• Falling international student numbers threatens universities – despite the rise in domestic fees. The Observer notes the rise in National Employers’ Contributions from April 2025 has left many institutions worse off overall. Concerns have been underlined by UCAS data showing that applications for study visas were 13% lower in the year to the end of January than they were a year earlier, driven by a clampdown on students bringing dependants.
• Since 2017, English universities have faced income decline due to frozen £9,250 fees amid inflation. About 90 universities are restructuring, implementing redundancies to reduce wage bills. Nearly a quarter of top UK universities are cutting staff and budgets, risking 10,000 job losses, raising concerns about harming the sector's international reputation.
• The UK government will invest £20 million in new regional improvement teams to address struggling schools. Currently, over 600 'stuck' schools in England have repeatedly poor Ofsted reports, affecting 300,000 students. These students typically achieve worse results by 14 percentage points in primary and a grade lower per subject in secondary school. RISE teams will create tailored improvement plans, with up to £100,000 in funding available for specialist support per school, compared to the previous £6,000 grant. The initiative seeks to strengthen the school accountability system and deliver better outcomes for pupils and parents.
• A legal challenge against the UK policy taxing private school fees is set for a hearing. This controversial policy, vital to Labour’s 2024 election manifesto, imposes VAT on private school fees. Lord Pannick successfully argued for an expedited hearing, citing parent uncertainty due to the policy's impact. Experts predict most schools will hike fees by 10-15% to cover potential revenue losses, though some may absorb the costs.
• Since 1 January 2025, private schools are no longer exempt from VAT and have faced a 20% rise in fees. The government estimates the additional tax income will amount to £460 million extra to spend on state schools. A series of independent private schools announced plans to close due to financial challenges, including the introduction of VAT on school fees and rises in the national minimum. The list includes Loughborough Amherst School and Earl Spencer’s prep school, Maidwell Hall.
• Introduced into Parliament in December 2024, The Children’s Wellbeing and Schools Bill introduces a wide variety of measures to help children and families, from school reform and home education to safeguarding. Core focus areas include teacher training and ensuring all schools have qualified teacher status. The Bill sets out that all teachers will be part of the same core pay and conditions framework – whether they work in a maintained school or an academy, while also mandating the curriculum and assessment system undergo review.

Healthcare & Social Assistance

• Government ramps up efforts to end HIV transmissions in England. Public health campaign to end HIV transmissions in England by 2030 is given £1.5 million fund from government. Funding will increase testing, reduce stigma, tackle health disparities and raise awareness, including over 20,000 self-testing and self-sampling kits to be made available to help end HIV transmissions by the end of the decade.
• Local communities are set to receive £200 million in funding for family and school nurses, sexual health clinics and other public health services. This investment is a key part of the government’s Plan for Change, shifting the focus from hospital to community and from sickness to prevention to build a more sustainable, fit for future NHS.  
• A World-leading AI trial to tackle breast cancer has launched. Nearly 700,000 women will participate in a UK trial to test AI tools for earlier breast cancer detection, the Department of Health and Social Care announced on 4 February 2025. Currently, two specialists review each mammogram, but this AI technology allows one specialist to handle screenings safely and efficiently. If successful, the trial could free up hundreds of radiologists, enabling them to see more patients, address rising cancer rates, save lives and reduce waiting lists. The EDITH trial, funded by an £11 million grant from the National Institute for Health and Care Research, aims to revolutionise cancer screening.
• NHS England will halt plans to advance cancer diagnosis, women's health and childhood vaccinations to prioritise reducing waiting times. The health service will also abandon commitments to expand dental access, stroke prevention drugs and care for those with learning disabilities. Plans to increase dementia diagnoses, patient choice in treatment locations and talking therapies for mental health will be scrapped. Health Secretary Wes Streeting has directed the NHS to focus on shortening A&E, cancer care and hospital treatment waiting times. This shift aims to benefit hundreds of thousands with faster access and diagnosis as surveys highlight public concern over extended NHS waiting periods.
• Following a review of the New Hospital Programme (NHP), it was found that the previous government's commitment to deliver '40 new hospitals' by 2030 was behind schedule, unfunded and undeliverable, according to an assessment by the Infrastructure Projects Authority. The current government is committed to rebuilding the NHS and restoring trust in government. The new plan, which is both affordable and honest, will be backed with £15 billion of new investment over consecutive five-year waves, averaging £3 billion a year.
• With the over-65 population now at 13 million, the demand for adult care has surged, leading to over two million requests in 2022-23 and £23.7 billion in expenditures. Key issues include a workforce shortage of 131,000 vacancies and 430,000 individuals awaiting assessments or care, underscoring the need for substantial investment and reform to address these systemic problems effectively.
• The government’s reform plan pledges to meet the NHS standard that 92% of patients should wait no longer than 18 weeks for treatment by March 2026. This compares with the current performance of just 59%. To do so, the Health Foundation estimates an additional 2.6 million more treatments will be needed per year to meet the 18 week standard.
• In January 2025, Keir Starmer launched a new partnership between the National Health Service and the private sector in England to tackle the growing waiting list, which stands at 7.5 million. The government also outlined plans to introduce local diagnostic centres offering an extra 450,000 appointments for tests.
• New funding and reforms are set to help the social care sector. Health and Social Care Secretary Wes Streeting will confirm an £86 million boost to the Disabled Facilities Grant for the 2025-26 fiscal year - on top of the £86 million announced for the next financial year at the Budget, taking the annual total to £711 million - to allow 7,800 more disabled and elderly people to make vital improvements to their home, allowing them to live more independent lives and reducing hospitalisations. Care workers will be better supported to take on further duties to deliver health interventions, such as blood pressure checks, meaning people can receive more routine checks and care at home. As part of the long-term plan to overhaul social care, the government will launch an independent commission into adult social care to be chaired by The Baroness Casey of Blackstock DBE CB, to inform the work needed to deliver in January 2025.

Arts, Entertainment & Recreation

• Gambling companies in Britain might need to revise their advertising strategies following a ruling against a betting firm for unlawfully targeting a problem gambler with over 1,300 marketing emails. The judge noted that although the man hadn't opted out of marketing, he was deeply entrenched in gambling addiction and unaware of how his data was utilised. The Gambling Commission has introduced measures to protect consumers better. However, campaigners argue the industry often fails to identify high-risk gamblers. According to the Office for Health Improvement and Disparities, around 1.6 million adults in England who gamble could benefit from treatment or support for harmful gambling.
• ONS data shows Arts activity shrinks by 15% between July and October 2024. The drop in the category – which includes the performing arts, support activities, artistic creation and arts facilities – is contributing to reduced output in the wider category of arts, entertainment and recreation. This fell by a cumulative 4.1% over the same period.
• The Department for Culture, Media and Sport is set to introduce a statutory levy on gambling companies to help fund addiction treatment. New online gambling limits to be set – £5 per spin limit will apply to all adults aged 25 and over with a £2 per spin limit for 18 to 24-year-olds.
• According to the Entertainment Retailers Association (ERA), UK music sales hit record high as Taylor Swift tops album sellers. ERA data reveals that consumption of music in the UK – based on sales and streams – grew by 9.7% in 2024 to 200.5 million album equivalents. The volume of audio streams grew by 11% to 199.6 billion.
• BBC has commissioned new art and culture programmes as part of its commitment to Art & Culture. New Arts TV programmes unpack contemporary culture, celebrate British creativity and explore landmarks in the global story of art including Renaissance: The Blood and The Beauty, Simon Schama’s History of Us and the return of epic series Civilisations.

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