Analysis by restructuring firm Kroll has identified a significant increase in corporate distress, with a 30.5% rise in companies filing for administration last month, from 108 last year to 141. The construction and manufacturing sectors were particularly affected, each seeing 18 administrations. Benjamin Wiles, head of UK restructuring at Kroll, noted: “There are mounting pressures on all businesses,” highlighting the challenges posed by rising National Insurance contributions and uncertainty around trade tariffs. While 90% of larger businesses feel prepared to tackle these challenges, only 74% of smaller firms share this confidence, with 27% feeling less prepared than the previous year. Sarah Rayment, managing director at Kroll, said feedback from small businesses was “concerning,” commenting: “While it’s encouraging to see that some businesses are planning proactively, it is unsurprising to see that smaller companies face steeper hurdles with fewer resources and capital reserves.”

Financial services leaders are optimistic about London’s growth potential, according to KPMG’s latest UK Financial Services Sentiment Survey. The poll of 155 sector leaders saw more than half say that negativity around London’s status as a financial hub has been overplayed. Almost a fifth said they plan to invest more than 40% of total revenues in London operations, while over a third planned to expand their physical footprint in the City. Karim Haji, global and UK head of financial services at KPMG, said: “The fact that industry leaders are planning to invest substantially more in the City underscores its significance as an engine of capital allocation and future economic growth.”

Small business leaders are urging the Government to alleviate the tax compliance burden to stimulate growth. A survey by the Federation of Small Businesses (FSB) revealed that small firms are incurring costs of up to £25bn annually due to tax obligations. On average, each small firm spends £4,500 and 44 hours yearly on compliance, with many struggling to contact HMRC due to issues with customer service. Tina McKenzie of the FSB said: “This is money and time that could be far, far better spent on building up their business.” She added: “Given the challenges facing the economy, and the need for growth, reducing the burden placed on small firms by tax compliance must be a priority.” Calling for HMRC to be included in the Government’s drive to ensure regulation better supports growth, Ms McKenzie added: “We deserve a tax system that is fit for purpose.”

SMEs have voiced concern over the introduction of the extended producer responsibility (EPR) tax, which affects companies with sales over £1m and that use more than 25 tonnes of packaging. Over 100 small food businesses are campaigning for rethink over the regulations, which they deem “shambolic.” The Government maintains that the EPR will “create 21,000 jobs and help stimulate more than £10bn of investment in recycling over the next decade,” but many small firms say the costs could put their business at risk. The Food and Drink Federation, an industry trade body, estimates that EPR compliance will cost businesses £1.4bn in the first year.

The average pensioner in the UK is projected to incur an additional £3,000 in tax by 2028 due to frozen income thresholds. The personal allowance, which has remained at £12,570 since April 2021, is set to stay unchanged until April 2028, despite inflation. Analysis indicates that a typical pensioner earning around £30,000 will pay £19,998 in tax over the six-year freeze, compared to £17,038 if thresholds had risen with inflation, resulting in a £2,960 difference. The analysis notes that 8.2m over-60s could be pushed into higher tax brackets. Jon Greer from Quilter warned: “Pensioners are being quietly dragged into the tax net thanks to years of frozen thresholds and rising income.” He added: “What might once have been seen as a modest retirement income is now being taxed more heavily each year, all without a single change to the tax bands.”

Matthew Lesh, a country manager at Freshwater Strategy and public policy fellow at the Institute of Economic Affairs, considers the implications of the rising national minimum wage, which has increased from £3.60 to £12.21 in the last 26 years. He highlights that while Office for National Statistics data shows a 5.9% rise in pay, it also reveals concerning trends, such as a drop in job vacancies to 781,000 and a decrease of 78,000 in payroll numbers. Mr Lesh argues that the minimum wage hike may hinder employment opportunities, particularly for the lowest-skilled workers, saying that 85% of reliable studies show that minimum wages hurt employment. He warns that the combination of rising National Insurance rates and increasing regulations could make hiring prohibitively expensive for businesses, ultimately exacerbating economic inactivity among young people. Mr Lesh argues: “If policymakers are serious about boosting employment and reducing welfare dependency, they must reckon with the unintended consequences of their own interventions,” adding: “Making work pay is one thing, but making work possible is just as crucial.”

Analysis by HR platform Employment Hero shows that staff at SMEs saw their wages fall at the end of March. While Office for National Statistics data shows that wage growth across the wider UK economy has exceeded 5% in every month since September, analysis shows that there has been a decrease in median full-time pay across 105,000 SMEs. The report shows that staff at these firms are earning as much as £250 less a year than they were at the end of 2024. With firms looking to absorb the impact of an increase in employer National Insurance contributions, Kevin Fitzgerald, managing director at Employment Hero, said businesses “are clearly making difficult decisions to maintain competitiveness in an increasingly challenging trade environment.”

Ministers are facing accusations of favouritism and lack of transparency after ordering a merger of two pension funds covering traditionally Conservative areas in southern England, while Labour-dominated pools in the North and Wales were left untouched. The Government is pushing to create ‘mega-funds’ as part of a major reform of the £400bn Local Government Pension Scheme (LGPS) to drive economic growth, citing examples from Canada and Australia. Though all pools are to be regulated by the Financial Conduct Authority (FCA), critics are questioning why Access, covering 11 councils in South East England, and Brunel, which covers South West England, were singled out for forced mergers. Access warned the merger could cost £150m, while Brunel is already FCA-authorised. In contrast, Northern LGPS and the Wales Pension Partnership, neither FCA-regulated, were not required to merge.

Office for National Statistics data shows that company pension contributions have fallen by 16% in the last three years, with the decline hitting 30% when adjusted for inflation.

Rachel Reeves is set to argue for global free trade when she meets with finance ministers and central bankers at an International Monetary Fund event in Washington. Pointing to new tariffs on exports into the US, the Chancellor said: “The world has changed, and we are in a new era of global trade,” adding that she is “in no doubt that the imposition of tariffs will have a profound impact on the global economy and the economy at home.” A senior UK official said: “We’re facing a new economic reality, but we’re a heavily trading country, with the value of our exports the equivalent of 60% of GDP, so it’s always in our own interests to promote free trade.”

As the landscape of work evolves, companies are increasingly offering creative perks to entice employees back to the office. According to Hays, nearly 40% of firms are implementing incentives such as luxurious office designs, onsite nurseries, and unique activities like rooftop yoga and pop-up nail bars. Harry Wilson Hallberg, CEO of FlowSpace, noted: “Companies are now looking for innovative offices and activities to bring staff back to the office.” A survey by Kahoot! revealed that a third of 25 to 34-year-olds would consider quitting if forced to work more in the office. The trend is prompting landlords to create engaging office environments, with some firms like Goldman Sachs and Morgan Stanley leading the way by providing onsite childcare. However, not all employers are convinced that such perks are necessary, with some expressing concerns about the focus on incentives rather than genuine engagement.