The number of business insolvencies in England and Wales rose by 13% last month, with data showing that almost 2,000 firms collapsed in November. While November saw a month-on-month increase in business insolvencies, the total was 12% lower than November 2023. November also saw the number of administrations rise by over a third, while court-driven compulsory liquidations were up 37%. Tim Cooper, president of insolvency and restructuring trade body R3, said: “Fallout from the Budget and ongoing cost issues have driven corporate insolvencies,” while Mark Ford, a partner in Evelyn Partners’ restructuring and recovery team, noted that even before the Budget, some businesses “were already under significant strain and saddled with debt following a long period of high borrowing costs, high inflation and low consumer confidence.” The Insolvency Service data shows that individual insolvencies rose by 25.5% year-on-year and 12.2% month-on-month.

According to Teneo’s CEO and investor outlook survey, over half (56%) of British public limited companies have contemplated relocating their listings overseas in the past year, a significant increase from 27% the previous year. Despite this trend, 68% of UK chief executives believe the value of being listed in the UK has risen, up from just 5% last year. Furthermore, 78% anticipate that the value of a London listing will improve in the next year. The Financial Conduct Authority has initiated major reforms to attract companies to UK markets, including a simplified listings regime. However, the London Stock Exchange Group reported a net outflow of 70 companies from the main market this year, the largest since 2009, indicating that the reforms have yet to reverse the trend of companies leaving London.

Analysis by the British Retail Consortium (BRC) shows that 225,000 retail jobs have been lost over the past five years, with the workforce falling from 3.1m to less than 2.9m since 2019. There were 2.81m jobs in retail in September 2024, Office for National Statistics data shows, with this 40,000 fewer than last year and 225,000 fewer than five years ago. Retailers have warned that they face a hike in costs due to the increase in employer National Insurance, which was announced in the Budget, saying it will cost them £7bn next year. The BRC has also called for reform of the business rates system, with chief executive Helen Dickinson saying: “Without this, more stores will be forced to close, meaning fewer retail jobs.”

Office for National Statistics (ONS) data shows that regular pay growth hit 5.2% between August and October, marking the first acceleration in more than a year. Private sector pay grew at an annual pace of 5.4%, while across the public sector, pay growth came in at 4.3%. Analysts say the data on pay means the Bank of England is unlikely to cut interest rates when officials meet this week. Gora Suri, economist at PwC UK, believes that rates are “highly likely” to be kept at 4.75%, while Thomas Pugh at RSM UK, said: “The jump in wage growth puts another nail in the coffin of an interest rate cut.” The ONS also reported that unemployment rate was unchanged at 4.3%, while the number of job vacancies fell by 31,000 to 818,000 in the September-to-November period. Joe Nellis, an economic adviser to MHA, said the unemployment rate holding steady “is not a significant cause for celebration,” warning that long-standing problems in the labour market “continue to undermine attempts to reignite a flatlining and underperforming economy.” Looking ahead, Yael Selfin, chief economist at KPMG UK, said: “We expect labour market activity to ease over the coming year as employers look to get ahead of the upcoming rise in National Insurance contributions, which should put further downward pressure on wage growth and employment.”

UK exporters experienced a significant £27bn decline in goods sales to the European Union following Brexit, with smaller firms disproportionately affected. Research from the Centre for Economic Performance revealed a 6.4% drop in the UK’s global exports and a 3.1% decrease in imports. Since the UK left the EU’s customs union and single market in January 2021, many smaller companies have struggled, with exports to the EU falling by 30% for the smallest firms. Despite these challenges, the UK’s services exports have shown resilience, with a trade surplus of £40bn this year. The report suggests that larger exporters adapted to the new trade barriers, mitigating some of the anticipated economic costs of Brexit.

London School of Economics analysis suggests that Brexit’s impact on UK trade was less severe than had been forecast, with exports down £27bn down in 2022 and imports £20bn lower.

The Financial Conduct Authority has set out its plans for the Private Intermittent Securities and Capital Exchange System (PISCES), a new private stock market system that officials say will “open the door to more opportunities for investors to take stakes in private companies.” The City watchdog said: “With many companies choosing to stay private for longer, there is increasing demand for investors to be able to trade shares in private companies more easily,” adding that PISCES “could provide opportunities for more diversified returns for investors.” Simon Walls, the FCA’s interim executive director of markets, said: “There is demand from investors for an organised marketplace on which to buy and sell stakes in growing private companies.” City Minister Tulip Siddiq says the move is a “significant step forward” in the Government’s reforms to capital markets and will “give investors the chance to get in on the ground floor of some of the most exciting companies and support the growth of those businesses.”

Barclays has lost a court challenge against a ruling by the Financial Ombudsman Service, which has opened the door to potential compensation claims over mis-sold car loans. The Financial Conduct Authority is currently investigating the commission structures that led to these mis-sold loans, with potential customer compensation costs estimated at £6bn.

The Lending Standards Board (LSB) has conducted a review revealing that 102 areas require action to ensure compliance with the Standards of Lending Practice for business customers. Emma Lovell, LSB chief executive, said: “Registered firms’ performances in this review are encouraging… but when it comes to delivering the right outcomes for SMEs, there is always room for improvement.” The review covered 16 UK lenders, with 59% of identified issues already addressed. Key areas needing attention include support for vulnerable customers and governance frameworks. The report emphasises the importance of independent oversight, as many UK SMEs rely on these standards for protection. The LSB’s strategic plan for 2024-27 aims to enhance oversight and address emerging lending risks.

The Northern Powerhouse Investment Fund (NPIF) has had a noteworthy year, closing its first investment period and launching NPIF II with £660m to support small businesses in the North of England. NPIF has provided over £1bn in investments, creating more than 8,000 jobs. NPIF II aims to continue this momentum, addressing the funding gap for smaller businesses, particularly in underserved areas.

Financial experts are cautioning families against hastily transferring assets to evade the impending increase in inheritance tax. The Government’s decision to impose a 20% inheritance tax on agricultural assets exceeding £1m has led to a surge in property transfers, with Land Registry analysis pointing to a rise of over 45% this year, reaching around 220,000 estates. There is also concern that a potential rise in capital gains tax could drive a surge in passing down inherited property. Research by Standard Life shows that nearly a third of savers are considering giving away money to family members more regularly to reduce their inheritance tax liabilities, while one in five are planning to buy an annuity to avoid a large IHT bill. Mike Ambery, retirement savings director at Standard Life, has advised against rushing such decisions, saying: “While it’s natural to consider how to minimise inheritance tax liability… it’s important that people consider their own retirement incomes.”

Amid concern that Thames Water could run out of funds by March if restructuring plans are not approved, two groups of creditors are in a High Court dispute over how best to keep the firm afloat. The company is burdened with £16bn of debt and requires £3.3bn over the next five years to maintain operations. While a plan which has garnered support from over 75% of Class A creditors aims to provide “additional liquidity to act as a bridge” before a larger restructuring next year, a rival plan proposed by Class B creditors offers more attractive terms, including a lower interest rate.