UK households’ confidence in their job security slumped in February, according to a report by YouGov and the Centre for Economics and Business Research (CEBR). Job security perceptions fell to 92.6 on an index where a score higher than 100 indicates positive sentiment. February’s score was down 1.1 on January’s level and the lowest in six months. Despite this, respondents were more optimistic about the year ahead, with the forward-looking job security measure seeing a score of 117.6. The index looking at confidence in household finances for the next year came in at 95, while confidence in the housing market was up 3.2 to 134.8. Sam Miley, head of forecasting at the CEBR, noted that the situation in the Middle East poses a “major risk,” adding: “The ensuing volatility in commodity markets and potential for pass through to UK consumer prices could damage financial perceptions in the months ahead.”

According to a survey by Novuna Business Finance, 79% of small business owners in London report losing sleep over the various challenges faced by their firm. The primary concerns are economic volatility and geopolitical uncertainty, with these affecting 50% of respondents. Other worries include potential tax and interest rate hikes (37%) and managing cash flow (23%).  Joanna Morris, head of insight at Novuna, noted that many business owners “take their business worries home with them and struggle to switch off.” Despite highlighting the stress faced by entrepreneurs, the survey found that 40% predict growth in early 2026.

The UK’s construction sector faced a significant setback in February, with the S&P Global UK construction purchasing managers’ index (PMI) dropping to 44.5, down from 46.4 in January. Any reading above 50 represents growth. The data for February marks the 14th consecutive month of decline, with this primarily driven by a sharp downturn in housebuilding, which scored just 37. Wet weather also disrupted projects, contributing to the decline. Despite this, some firms remain hopeful for a turnaround in the coming year, with optimism at a 14-month high.

Several major lenders, including HSBC, Nationwide Building Society, and Coventry Building Society, are set to raise mortgage rates following the outbreak of conflict in the Middle East, which has increased market uncertainty and pushed up swap rates. The hikes will affect first-time buyers, home movers, remortgagers, and buy-to-let landlords, as lenders adjust pricing in response to higher funding costs and inflationary pressures. Experts warn that further increases are likely across the market, urging borrowers to secure fixed-rate deals promptly to protect against volatility.

The Government has been urged to address a 60% tax trap, with experts warning that frozen thresholds mean more than 2.1m people will lose some or all of their personal allowance in the 2026/27 tax year. Investment platform IG highlights that the frozen personal allowance creates a high marginal tax rate between £100,000 and £125,140, discouraging investment. Sean McCann, a chartered financial planner at NFU Mutual, said: “It’s the ambition of many people to reach an income of £100,000, but it comes with an unexpected sting in the tail.” Office for Budget Responsibility (OBR) forecasts show that the share of taxpayers paying higher or additional rates is expected to rise from 15% in 2021/22 to 24% by 2030/31, largely due to frozen thresholds. The OBR also estimates there will be 1.4m additional-rate taxpayers by 2028/29, up from 1.2m currently, meaning the number will have increased by 1m since 2017/18, when around 400,000 people paid the top rate.

Nearly all family businesses in Britain anticipate a significant impact from upcoming inheritance tax changes that impose a 20% levy on assets over £2.5m. A poll by Family Business UK shows that only 10% of owners believe they will remain unaffected. Among businesses with 10 to 49 employees, 55% expect a material impact, rising to 64% for those with 100 to 250 staff. Neil Davy, CEO of Family Business UK, said: “At a time when the UK desperately needs the economy to grow, this is the wrong policy at the wrong time.” The new inheritance tax regime will take effect in April.

The Diplomatic Advisory Hub has briefed over 600 businesses on the escalating conflict in the Middle East. Launched by the Foreign Office and the British Chambers of Commerce (BCC), the initiative aims to support firms affected by regional instability. Further briefings will address implications for costs, energy, and logistics. Shevaun Haviland, director general of the BCC, said: “Today’s first webinar on the situation in the Middle East was a powerful signal of how vital the Diplomatic Advisory Hub is.”

London is facing a severe office space crunch, with record rents being paid as demand outstrips supply across the City. According to Knight Frank, prime rents in the West End Core hit £185 per sq ft last year, while City Core rents rose to £102.50 per sq ft, with 170 deals exceeding £100 per sq ft. CBRE warns that the current development pipeline only covers around 18 months of demand, leaving major occupiers scrambling for space years in advance. Analysts say post-pandemic underestimation of office needs, rising construction costs, and a slow pipeline mean the City could face virtually zero Grade A vacancies by 2028.

Around one in seven UK high street businesses went cashless over the past year, according to a survey by ATM and cash access network LINK. Despite this, cash still accounts for 46% of in-person transactions, especially in cafés, pubs, convenience stores, and independent shops. Fraud prevention, security concerns, and limited access to deposit facilities were key reasons for going cashless. LINK has urged the Treasury to track cash acceptance in shops, not solely cash availability. It also calls on the Government to maintain safe, convenient cash-handling options for high street businesses via banking hubs, Post Offices, and deposit-enabled ATMs.