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.  

• Following the recent budget announcements, the ADHB warned that from April 2026, the average farm, valued at £2.2 million, would face an inheritance tax of £240,000. In response, two protest rallies have already been held in central London in November and December 2024, organised by the NFU, Save British Farming and Kent Fairness for Farmers. Recently, on 19 January 2025, a tractor rally was held at the Fakenham Racecourse in Norfolk to show solidarity for the farming community.

• 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.

• The AHDB's Early Bird Survey indicates a predicted drop in winter crops for the 2025 harvest. Wheat, winter barley and oilseed rape areas are all set to contract nationwide, with oilseed rape expected to decrease by 17%, the lowest level in 42 years.

• 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.

• In January 2025, the UK government banned the import of live animals and meat from Germany due to concerns over foot-and-mouth disease detected in Berlin. Farming Minister Daniel Seicher emphasised the commitment to protecting UK farmers, stating there would be no hesitation in imposing further restrictions if necessary.

• A recent report from Scottish Parliament Members highlights urgent concerns about the salmon farming industry's long-term sustainability in Scotland. The Committee calls for swift action, citing slow progress on environmental improvements and unaddressed recommendations from 2018

Mining

• The Office for National Statistics reports that the mining and quarrying sector output declined by 1.5% in November 2024, continuing its longer-term downward trend. The fall was mainly driven by a 1.8% contraction in the extraction of crude petroleum and natural gas.

• World Bank Commodities Price Data released in December 2024 shows that the monthly average prices for coal and crude oil fell in November 2024 after a slight hike in October 2024. Metals and minerals monthly average prices have followed suit, with aluminium, copper, lead, iron ore and zinc prices falling. Precious metals (gold, platinum and silver) have also recorded a dip in prices.

• A report by thinktank Common Wealth states that oil and gas in the North Sea must be brought under greater public control “to avoid a cliff-edge collapse of the industry and secure a sustainable future for workers and communities” as reported by The Guardian.

• 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 government will sign a critical minerals partnership with Saudi Arabia to attract investment into the UK and strengthen the supply chains of minerals like copper, lithium and nickel, which are crucial in various industries like electric cars, smartphones and data centres.

• According to the Financial Times, the government has committed to compensating developers of the £8 billion carbon capture project in the Northeast of England, including BP and Equinor, if planning permission is blocked amid an ongoing legal challenge by an environmental campaigner.

• 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 December 2024, the UK’s Manufacturing sector continued to contract, with the Manufacturing PMI falling to an 11-month low of 47, down from 48 in November. This marks the second consecutive decline in factory output, driven by a sharper drop in new orders. Contributing factors include slumping domestic market sentiment and weaker demand from European clients. The sector also experienced the most significant rise in purchasing prices since January 2023, attributed to supply chain disruptions linked to the ongoing Red Sea crisis.
• Rob Dobson, Director at S&P Global, noted that the tough conditions in the manufacturing sector at the end of 2024 have cast a "winter chill" over the labour market. December 2024 saw the most significant job cuts since February, fuelled by concerns about rising employer National Insurance Contributions and upcoming minimum wage increases in April 2025, prompting many manufacturers to consider restructuring.
• 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. DriveElectric estimates that UK EV sales will reach 440,000 in 2025, still below the target, sparking calls to relax the mandate.
• Under Trump’s presidency, there are concerns that anticipated 10-20% tariffs on UK imports could harm the competitiveness of UK cars in the US and disrupt the global EV market. Nevertheless, UK Treasury Minister Darren Jones expects that Trump will refrain from imposing heavy tariffs on the UK, enabling continued business relations with the US.
• On 16 January 2025, a £50 million investment deal was secured between the car manufacturers Japan Automatic Transmission Company (JATCO), Nissan and the UK government to build a new manufacturing site in Sunderland, which is set to create hundreds of jobs in the North East.
• 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 dropped by 0.4% in November 2024, following a decrease of 0.6% in October. This marks the lowest output level since May 2020. Seven out of 13 subsectors contributed to this decline, with other manufacturing and repair, basic pharmaceutical products and transport equipment making the largest negative impact.

Utilities

• From 1 November 2024, the energy profit levy will rise from 35% to 38% – bringing the headline tax rate to 78% – to ensure oil and gas companies contribute more to make the UK a clean energy superpower. The levy will apply until 31 March 2030.
• 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 an additional rise of nearly 3% in April 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 December 2024, Ofwat approved a £104 billion investment plan to upgrade the water sector in England and Wales for 2025 to 2030. This plan outlines investment strategies, service commitments and billing structures for water companies.
• Thames Water secured a £3 billion emergency loan to manage its debt and prevent renationalisation, ensuring funding until at least October 2025. However, this loan has an interest rate of 9.75% and includes additional fees. In December 2024, campaigners protested outside the court, claiming this ‘liquidity extension’ would add £250 annually to customers' bills. The campaign group Windrush Against Sewage Pollution plans to present a case to the High Court in February, advocating for the temporary renationalisation of Thames Water.
• Octopus Energy has surpassed British Gas as the UK's largest residential energy supplier by meters on supply, managing 12.9 million domestic electricity and gas accounts and capturing a 24% market share, according to the Financial Times.

Construction

• The latest S&P Global release reveals that the UK Construction PMI dropped to 53.3 in December 2024, down from 55.2 in November, indicating a slowdown in growth. The commercial sector saw the fastest growth, followed by civil engineering. Construction in the residential sector saw a slump in output, amid high borrowing costs and weak consumer confidence. Despite ongoing supply chain challenges and rising costs, optimism for 2025 has improved.
• On 12 December 2024, the updated National Planning Policy Framework (NPPF) was released to tackle the housing crisis. It 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.
• On 20 January 2025, the government announced that the New Hospital Programme’s plan to fit out 40 hospitals in England would be delayed by at least a decade. Health Secretary Wes Streeting stated that construction would occur in four phases, securing a "firm footing with sustainable funding" for successful delivery.
• 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.
• Data from the Department for Business and Trade showed that material price inflation stayed at the same level in November 2024 compared to the same month in 2023. Despite this, material prices for New Housing registered a 1.3% increase, Repair and Maintenance edged up by 0.7% and Other New Work decreased by 1.2% in the 12 months to November 2024. Precast concrete, including blocks, bricks, tiles and flagstones, saw the largest annual increase at 6.3%.

Wholesale Trade

• According to the Office for National Statistics, output in the wholesale and retail trade; repair of motor vehicles and motorcycles grew by 0.5% in November 2024, driven by a 1% climb in output in wholesale trade, except of motor vehicles and motorcycles. In the three months to November 2024, wholesale and retail trade; repair of motor vehicles and motorcycle output grew by 1.7%, making it the largest positive contributor to consumer-facing services output.
• Confex and Fairway have merged to create a new wholesale buying group, The Wholesale Group. The group will launch in January 2025 and aim to support independent wholesalers. According to The Grocer, the group will represent 12% of UK wholesale, with a joint annual turnover of about £4.5 billion, 253 members and about 350,000 customers.
• DBC Group has become a member of the Sugro UK group, which consists of over 90 independent wholesalers.
• Love British Food has called on wholesalers to promote domestic produce by launching ‘Buy British’ categories in a bid to boost demand.
• New figures show that trade with the EU has suffered severely due to Brexit, with Aston University estimating that annual exports and imports are 17% and 23%, respectively, below where they would have been if Brexit didn’t materialise.
• The Federation of Wholesale Distributors 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.

Retail Trade

• BRC and ONS data shows retail picked up in December 2024 which sales up by 3.5% in value and 2.9% by volume compared to the previous month. Electricals, beauty and books made for popular presents, while more expensive items like furniture took a hit.

• 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.

• Retailers anticipated 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 remained at -3 in December 2024, the same as in November, while the state of the economy worsened to -27 in December 2024, down from -19 in November. The public’s spending intentions dropped 6 points, with expectations of spending in nearly every retail category falling.

• 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.

• Headline inflation rose to 2.6%, pointing to price rises in early 2025. November’s figures were driven primarily by increased inflation rates of fuel and clothing and footwear. There was some welcome news for those shopping around early for Christmas presents, as furniture and household equipment remained in deflation, albeit not quite as low as in October.

Transportation & Warehousing

• From January 2025, the cap on most single bus fares in England will increase from £2 to £3 and will remain in effect until the end of the year. This change is part of an investment exceeding £1 billion in the bus sector, as announced in the Autumn Budget 2024.

• 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.

• HS2's latest report reveals that the estimated cost to construct the London to Birmingham line could surpass £80 billion at current prices, reflecting a 15% increase within a year due to rising expenses.

• 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.

• Amid renationalisation efforts, FirstGroup plc is diversifying its income by expanding bus and open-access rail routes. At the end of 2024, the company announced a £90 million acquisition of the French public transport operator RATP's London bus operations, securing contracts for 90 routes.

• 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. Meanwhile, Rachel Reeves plans to reaffirm her support for Heathrow's third runway, despite environmental opposition.

• 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.

• 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.

Accommodation & Food Services

• ONS data reports that output in accommodation and food service activities expanded by 2% in November 2024, the largest positive contribution in the services sector. Both food and beverage service activities and accommodation grew in November 2024, by 1.6% and 3%, respectively. Food and beverage service output decreased by 0.7% in the three months to November 2024.
• The higher employment costs amid the new Budget measures are forcing some smaller UK pub and hostel operators to rethink operations, including closing sites, halting expansion or redirecting investments away from the UK. For example, Wells & Co has cancelled a planned acquisition in the UK and put a hiring freeze in place, shifting their focus to expansion in France. The company’s chief executive Peter Wells has said that the Budget will add £700,000 to their expenses, reducing profit by 20%, as reported by The Financial Times.
• A survey of 5,000 businesses by the British Chambers of Commerce has warned that more businesses are looking to hike prices in response to the UK Budget and changes in tax and wage costs. Among the hospitality sector, rising labour costs were the top reason for businesses looking to increase prices. Meanwhile, hospitality businesses also reported one of the lowest levels of confidence relating to expectations of sales increasing over the next 12 months.
• A resurgence in office parties and family gatherings over the Christmas period has boosted pubs and bars bookings. Young’s reported a 30% hike in festive bookings, while Mitchells & Butlers bookings were 9% higher than the previous year.
• According to the Campaign for Real Ale, about 1,200 pubs are likely to close in 2025 (vs 1,000 in 2023 and about 800 in 2022) amid the high operating costs the establishments face, as reported by he Financial Times.
• A December 2024 report by The Caterer highlights that hospitality company insolvencies have reached a two-year low. Government data indicates that in October 2024, there were 253 insolvencies in the accommodation and food services sector, marking a 24% decrease from the 332 insolvencies in October 2023.
• The Scottish Budget has revealed the government will provide 40% business rates relief for hospitality venues with a rateable value of up to £51,000. Under the measures, UKHospitality warns that more than 2,500 businesses remain ineligible, leaving them with much higher bills than businesses located in England.
• The UK Tourism Minister has announced a new ambition for the UK to welcome 50 million international visitors per year by 2030. This is part of the government’s plan to remain one of the most visited globally and help drive economic growth. The tourism industry is worth £74 billion to the economy and represents 4% of GVA.
• The government has announced that the price of travel permits for EU and US citizens to enter the UK is rising from £10 to £16, raising an additional £269 million annually. However, there is criticism of the hike, warning it risks damaging tourism.

Information

• ONS data reports that output in the information and communication subsector climbed by 0.9% in November 2024, the second-largest positive contribution in the services sector during the month. This growth was driven by computer programming and related activities (up 1%) and telecommunications (up 1.2%).
• Data from research company Opensignal has found that the UK scored the worst of any G7 country for mobile reliability in 2024. The Financial Times states that, according to experts, low investment and planning permission delays for telecoms towers have contributed to the lack of reliability.
• Virgin Media O2 has sold a £186 million (about 8%) stake in its mobile masts business, Cornerstone, to infrastructure investment firm Equitix. The company retains 25% holding in Cornerstone, which is the UK’s largest mobile towers business.
• The Financial Times reports that the UK is considering a higher cap of up to 10% on foreign state ownership of British media, with the aim of encouraging investment from sovereign funds.
• The Civil Aviation Authority has granted German start-up Rocket Factory Augsburg permission to launch satellites from British soil, with Britain trying to get ahead in the race to launch satellites into space from European soil. Norway’s Andøya spaceport is one of the main competitors to the UK when it comes to launching satellites into space.
• Ofcom has published its final codes of practice for firms dealing with illegal online content, though still pending parliamentary approval. The Online Safety Act will take effect in March 2025 and social media platforms that fail to comply and assess whether users are exposed to illegal material could be fined up to 10% of their global turnover.
• Project Kuiper, Amazon’s satellite operation, is to go ahead with its plans to launch a broadband service in the UK, with Ofcom still considering whether to approve the company to provide this service. The satellite constellation is to be deployed in early 2025, with plans to roll out the broadband service later in the same year.
• 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.
• The Competition and Markets Authority 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”.
• In a survey by Boston Consulting Group and reported by the Financial Times, 51% of UK businesses plan to prioritise investment in AI over staff hiring as a result of the employers’ NI contributions hike in the Autumn Budget.

Finance & Insurance

• 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.
• The FCA considers loosening mortgage rules as it comes under government pressure to increase economic growth and home ownership across the UK. Regulators could end up reviewing how much first-time buyers are allowed to borrow and issue more loans to customers with smaller deposits.
• A survey by insurance company, Ecclesiastical, reveals 10% of UK insurance brokers and agents believe there is a talent crisis and retention is the largest threat to their businesses. Top threats cited by brokers include Financial Conduct Authority (FCA), regulation or compliance (18%); competition from other brokers (16.8%); and a hard market or reduced risk appetite from insurers (15.2%).
• Data from the Bank of England shows British consumer lending grew at the weakest pace at 6.6% in November 2024 since mid-2022. The data shows households remain cautious with borrowing and savings. Britain's economy stagnated in the three months to September and the BoE estimated in December 2024 that it was continuing to flatline in the fourth quarter.
• Net mortgage approvals dropped by 2,400 to 65,700 in November 2024, data from the Bank of England shows – a figure well below the 68,500 expected from Reuters’ economists. However, mortgage providers prove optimistic as the temporary first-time buyer stamp duty holiday comes to an end in March and from April, first-time buyers will start paying the levy for properties worth £300,000 or more, instead of £425,000 currently.
• The Payments System Regulator (PSR) is proposing to introduce a price cap to protect UK businesses on cross border interchange fees. Cross border interchange fees are currently set by card schemes and paid by UK merchants when accepting payments from EEA customers. A PSR report finds unjustified increases in these fees since the UK left the EU are harming businesses at a cost of £200 million per year.
• Card payments grow in popularity, but cash remains king. A 2024 Payments Survey by the British Retail Consortium (BRC) shows an uptick in the use of cash for the second year in a row to 19.9% of transactions in 2023 (from 18.8% in 2022). Debit cards remained far and away the most common method of payment, increasing to 62% of transactions (66.7% by spending). Taken together with credit cards, card payments accounted for over 75% of transactions and 85% of spending.
• To attract more businesses, the UK government is considering a series of reforms to captive insurance. Captive insurance is a form of self-insurance and is one of the fastest growing segments in the global market. The consultation document outlines potential changes, including lower capital requirements, reduced application fees, a faster authorisation process and reduced ongoing reporting requirements for captive insurers.  
• Buy-Now-Pay-Later (BNPL) platforms are booming, with US Affirm entering the UK market in November 2024. New legislation – like safeguards against unaffordable borrowing and credit card-style protection – is set to come into play in 2026 to protect consumers. FCA research found 14 million customers had used BNPL in 2023, and frequent users were four times more likely to have a missed payment than those who had not used the loans.

Real Estate and Rental and Leasing

• According to Nationwide, annual house price growth increased by 4.7% in December 2024 compared with December 2023. Prices increased 0.7% month on month and the average house price was £269,426. Prices remained below the all-time high from summer 2022.

• The housing market has been bolstered by buyers rushing to complete deals before the increase in stamp duty kicks in April 2025. According to Zoopla, the number of agreed UK property transactions surged by nearly a third at the end of 2024 compared with the same time in 2023.

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

• 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.

• The Resolution Foundation states that the right to buy has resulted in higher housing costs through private rents for low-income families rather than increasing home ownership. New Economics Foundation figures reveal that 41% of council homes sold under the right-to-buy scheme are now being rented out by private landlords.

• According to data from Savills, private equity firms and pension funds are flooding the UK rental houses market amid strong demand and a housing affordability crisis, with deals to buy or build rental homes surpassing £1.5 billion by the end of September, as reported by the Financial Times.

• On the commercial side, businesses are re-examining their approach to hybrid working and asking staff to return to the office. The legal sector has driven a significant rise for prime office space and regional cities like Manchester, Birmingham and Leeds are growing, capitalising on lower operational costs and access to skilled talent.

• The Chancellor announced a hike in the levy on second homes and buy-to-lets from 3% to 5%. The National Residential Landlords Association states that the supply of rental homes will suffer as a result, while Rightmove estimates the measure results in an additional £7,000 stamp duty cost for a landlord purchasing an average home.

Professional, Scientific & Technical Services

• ONS data reports that output in professional, scientific and technical services dropped by 0.5% in November 2024, mainly down to a 2.6% dip in accounting, bookkeeping and auditing activities; tax consultancy and a fall of 1.8% in scientific research and development. The subsector recorded a 0.6% growth in output in the three months to November 2024.
• Highlighting a slowdown in the professional services sector, Big Four accounting firm Deloitte UK has announced plans to cut spending on staff travel and expenses by over 50%, as reported by the Financial Times.
• The Financial Reporting Council has launched an investigation into Big Four accounting firm KPMG over its audit of Ladbrokes owner Entain.
• Two of the Big Four accounting firms, EY and PwC, are set to fall short of their 2025 targets for female partner representation in the UK. While Deloitte and KPMG have already met their UK targets, the two firms are on track to miss their global partnership targets. The Big Four have all set targets to increase their proportions of female partners, which would help in reducing their gender pay gaps.
• According to data from legal recruiter Edwards Gibson, a record number of partner hires in London were recorded in the year to 23 December, at 546 verses just 514 in the previous year. Strong investment from US law firms into the UK market has caused a war for talent.
• BDO has reported a record revenue of over £1 billion, rising by 8.6% on the back of higher investment in digitisation and staff. At the same time, despite adverse economic conditions, operating profit climbed 15% to £227 million. This is in contrast to the Big Four firms which have cut staff and faced weak demand due to the heightened economic uncertainty.
• According to data from Savills, since 2019, “London’s legal sector has driven a significant rise in demand for prime office space, with the industry accounting for 20% of the London office market”. Following the COVID-19 pandemic, legal firms have invested in high-quality workspaces that support hybrid work models in an attempt to attract and retain top talent amid the ongoing war for talent in the industry.
• According to data from Dealogic, dealmaking involving UK companies has outstripped the rest of Europe since the start of 2024, with the value of merger and acquisition (M&A) surging by 57% compared with the same period last year. The value of M&A activity in the UK was over twice that of second-placed Germany.

Education

• Most graduates can expect to earn more than non-graduates although studies show the extra money earned after a university education has dropped. According to HESA’s survey of 2020-21 graduates, the average salary reported 15 months after gaining a degree was £29,699. The disparity in earnings differs significantly between subjects, with little or no difference in earnings for those studying creative subjects or artistic degrees, while rising to £250,000-£500,000 more over a lifetime in subjects like law or economics.
• Following the introduction of VAT on private school fees, interest from Chinese buyers has grown amid concerns may schools will struggle to keep doors open, according to Chinese consultancy, Venture Education. 
  The Learning and Work Institute warns of unequal growth thanks to skills chasm and huge regional disparities in qualifications. The ThinkTank notes the proportion of people with higher education qualifications is twice as high in some parts of the UK than others, varying from two-thirds in London to one-third in Greater Lincolnshire. If trends continue, 71% of Londoners and 65% of adults in Scotland will have a degree by 2035, compared with 29% in Hull and East Yorkshire and 39% in Norfolk.
• The government has been urged to provide clarity to universities and students by confirming future tuition fee caps increases across England. In November, ministers said the tuition fee cap in England would go up for only the second time since 2012. In 2025-26, the cap will rise from £9,250 to £9,535. Any further inflation-linked increases to the cap will be contingent on universities implementing a “sustained efficiency and reform programme”.
• 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

• 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.
• From 1 January 2025, all medicines sold in the UK will need to be labelled as ‘UK Only’. The British Generic Manufacturers Association (BGMA) warns not all suppliers will have their labelling ready – potentially leading to shortage due to bureaucracy.

Arts, Entertainment & Recreation

• 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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