UK Industry Fast Facts

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

Agriculture, Forestry & Fishing

• The EU has warned the UK it must meet its commitment to check goods entering Northern Ireland before talks can begin on an agrifood trade deal. The agreement, expected by 2027, aims to establish a veterinary or sanitary and phytosanitary agreement to boost agrifood trade between the partners. Any proposed deal aims to reduce costs and paperwork for farmers exporting meat, dairy, eggs and plants to the EU, where UK agrifood exports have fallen since Brexit. Delays risk prolonging uncertainty and keeping trade barriers in place for producers across Great Britain, supplying Northern Ireland and EU markets.

• Extreme weather delivers a poor harvest, with farmers blaming heavy rainfall followed by prolonged dry spells for damaging yields. Government data released in January 2026 shows that all the main cereal crops saw reduced yields in 2025, except for winter barley. The final estimate of the 2025 UK wheat harvest is 12 million tonnes, an increase of 7.3% on 2024. This is due to a 9.1% increase in area to 1.7 million hectares, tempered by a 1.7% decrease in yield to 7.2 tonnes per hectare. Meanwhile, barley harvest stood at 6.4 million tonnes, a decrease of 10% compared to 2024. Spring barley saw a 16% fall in production and a 5.4% fall in yield, whereas winter barley saw a 1.2% increase in production and a 7.2% increase in yield.

• Analysis from the Energy and Climate Intelligence Unit shows that record heat and drought cost Britain’s arable farms around £824 million in lost output in 2025. The losses follow the country’s hottest and driest spring on record and an exceptionally hot summer, which together pushed average yields of wheat, oats, spring and winter barley and oilseed rape roughly 20% below the 10-year average.

• In February 2026, McCain announced a UK “Farm of the Future” site in North Yorkshire, launching in 2026. Farm of the Future UK will partner with the University of Leeds to provide scientific research and validation to accelerate innovation in British agriculture. McCain’s Farm of the Future UK will be the most advanced Farm of the Future to date, adopting practices like controlled traffic farming, year-round soil cover and biodiversity building. It will also be the first Farm of the Future location to pilot a circular nutrient system. According to McCain’s recent Farmdex research, while many farmers are concerned about the future of UK farming, 77% agree that sustainable practices are essential.

• UK food and farming groups are urging ministers to build in a transition period amid talks of realigning UK agri-food rules with the EU. Industry-commissioned analysis cited by the NFU and CropLife UK suggests abrupt alignment could cost the arable, horticulture and sugar sectors £500 million to £810 million in the first year, by removing access to some GB-approved crop protection products and undermining control of pests, weeds and disease.

• UK farmers have warned of crops rotting in the ground after an exceptionally wet start to 2026. In southern England, the Financial Times reports that in Reading, where more than 100 global climate scientists met this week, rain has fallen for 32 consecutive days, the longest continuous spell in records going back a century.

• The Food and Drink Federation has warned that the UK government will struggle to deliver on its pledge to strip out red tape for food and drink exports to the EU, citing poor preparation and staff shortages in key border and regulatory agencies. The body’s concerns over the practical challenges of implementing a new sanitary and phytosanitary deal have been echoed by other trade groups, which fear that rushed changes could add friction.

• Defra has announced a major overhaul of the Sustainable Farming Incentive, introducing tighter limits on how the scheme operates. Annual payments will now be capped at £100,000 per farm, previously uncapped and the number of available actions reduced from 102 to 71. Ministers say the changes are intended to share funding more evenly across farm sizes, but critics argue the cap could make larger projects harder to justify financially.

• British beef farmers are grappling with a double blow from climate change, with relentless rain at the start of 2026 forcing them to keep cattle indoors and last summer’s drought leaving them short of hay for winter feed. This is set to push beef prices higher as tighter forage supplies and rising feed costs squeeze farm margins, limiting herd expansion and reducing the volume of cattle coming to market.

Mining

• The Office for National Statistics reports that the mining and quarrying sector output dropped by 0.7% in December 2025. However, output from the sector climbed by 1.4% in the three months to December 2025.
• World Bank Commodities Price Data released in February 2026 shows that the average Brent crude oil and WTI crude oil prices have climbed at the start of 2026 amid heightened global uncertainty and tensions. In Q4 2025, prices were lower than in the previous quarter and compared to Q4 2024. Recently, the International Energy Agency projected a record surplus in 2026, placing severe pressure on oil prices. This is backed by Goldman Sachs, which projects oil prices to decline through 2026 due to a production surge and a large surplus of two million barrels per day.
• Metal prices have been extremely volatile recently, with precious metals recording a huge rise. World Bank Commodities Price Data released in February 2026 shows all metals and minerals recording higher prices in January 2026. Most metals, except lead and nickel, ended Q4 2025 higher than Q4 2024. Meanwhile, gold and silver prices continued to rise, thanks to continued geopolitical tensions and economic instability, with both precious metals reaching record highs. A weakening US dollar and US policymaking concerns have encouraged investors to flock to gold, given its reputation as a “safe haven” asset. Gold surpassed US$5,300 (about £3,400) per ounce on 28 January, before a sharp sell-off eased prices going into February 2026. However, gold prices have since eased by mid-February, with investors cashing in on the recent surge.
• The escalating conflict in the Middle East has caused oil and gas prices to surge at the start of March 2026, with the BBC reporting on 3 March 2026 that UK gas prices surged 46%, while Brent crude oil prices climbed 17%.
• The Telegraph reports that Britain is in talks with leading global miners, including Glencore, Rio Tinto and Anglo American, to lock in long-term supplies of critical minerals amid rising fears that tensions with China could disrupt access to materials vital for defence equipment, green technologies and advanced manufacturing.  
• The Tony Blair Institute for Global Change has urged the UK government to lift the ban on new oil and gas exploration licenses in the North Sea, as these are needed to protect thousands of workers. It has also called for the windfall tax to be wound down as it has deterred investment.
• The UK government’s Vision 2035 Critical Minerals Strategy, updated in late January 2026, sets out ambitions to produce 10% of domestic demand for key minerals and to host at least 50 active critical mineral projects, including mining. In the UK, it is anticipated that by 2035, demand for copper will almost double, while demand for lithium will increase by 1,100%. The UK faces limited domestic mining and processing capacity for many key inputs. It states that “as a net importer of critical minerals, the UK faces strategic vulnerabilities”, with the UK having to “work with international partners to build more resilient and diversified supply chains”. As such, the UK and the US signed a Memorandum of Understanding on critical minerals on 4 February 2026, whereas both countries “intend to support the supply of raw and processed critical minerals crucial to the commercial and defense industries of both countries”. The approach lays out an understanding of a common policy approach on the Securing Supply, Investment in Mining and Processing, Permits and Pricing on critical minerals.
• Cornish Metals has announced a letter of interest from the Export-Import Ban of the US, for as much as US$225 million (approx. £165 million) in funding to develop and restart the South Crofty tin mine in Cornwall. Investment would be conditional on the mine “providing a responsible supple of tin to the US, which has labelled it a critical mineral”, as reported by Bloomberg.
• The UK’s first commercial-scale lithium refinery has opened in Redruth, Cornwall, marking a significant step towards building a domestic supply chain for battery metals and reducing reliance on imports. Geothermal Engineering’s facility will produce 100 tonnes of lithium annually, with the aim to hike capacity to 1,500 tonnes within a few years and to over 18,000 tonnes over the next decade.
• The Financial Times reports that eight former UK energy ministers have urged the government to reverse course on tougher taxes and regulatory curbs on North Sea oil and gas producers, warning that current policy is deterring investment and undermining energy security. Tighter conditions on new developments risk accelerating the decline in domestic production, increasing reliance on imports at a time of geopolitical uncertainty and volatile commodity prices.

Manufacturing

• S&P Global’s UK Manufacturing PMI edged down marginally to 51.7 in February from 51.8 in January, which had marked the highest reading since August 2024, signalling that the sector remains in expansion despite a slight loss of momentum. Growth continues to be underpinned by improving external demand, with new export orders rising to 52.4 from 51.9 – the strongest reading since August 2021 – reflecting firmer demand from China, Europe, the US and the Middle East. However, the survey also pointed to mounting cost pressures, with input prices increasing at the sharpest rate since August 2025, suggesting that while output and orders are strengthening, manufacturers are still grappling with squeezed profit.

• SMMT data shows that in January 2026, British vehicle production fell 13.6% year on year, driven by an 8.2% drop in car output and a 68.6% fall in commercial vehicles. The slump reflected a cyberattack at Jaguar Land Rover, the closure of Vauxhall’s Luton plant, model changeovers at Nissan and trade disruption after US tariffs rose to 10% under Donald Trump. With 78% of cars exported, the sector remains exposed to protectionism, particularly emerging “Made in Europe” proposals from the EU. While the SMMT expects a 10% rebound in 2026 and output to rise above one million vehicles by 2027 as new EVs launch, high energy costs and tighter EU rules of origin continue to pose significant risks.

• New research from Forterro shows many UK manufacturers and exporters are poorly prepared for the EU’s Digital Product Passport (DPP) regime, which is due to start in 2027 and will require detailed digital records of a product’s lifecycle, composition, traceability and sustainability for goods sold into the EU. Fewer than half (47%) of firms surveyed are even aware of the requirements and only 43% say they are ready to comply, with many citing regulatory complexity, lack of technology and limited internal resources as major barriers; some businesses expect to spend around £28,000 on preparations. This leaves UK manufacturers at risk of losing EU market access or facing penalties if they fail to meet DPP obligations, at a time when exports remain vital to sector recovery.

• The UK’s plan to introduce a new carbon border tax has triggered alarm among heavy industry, with steel, cement and chemicals groups warning it could accelerate the decline of domestic manufacturing. The proposed carbon border adjustment mechanism, due to start in 2027, will levy charges on high‑emission imports so that companies which pay for their emissions in the UK aren’t undercut by cheaper, more polluting rivals overseas.

• Greater commitments to defence spending have started to reshape parts of Britain’s old industrial base. In January, the Financial Times reported that a historic Sheffield steelmaker is being converted into the country’s newest gun factory, due to begin operations by spring 2026. South Yorkshire is among the regions chosen to benefit from a £250 million Defence Growth Deal, a key element of the government’s new Defence Industrial Strategy.

• The UK government has awarded a £1 billion contract to Italian defence contractor Leonardo to build a new fleet of military helicopters, providing a significant boost to the domestic aerospace manufacturing sector. More than 40% of the work will be carried out at the company’s Yeovil manufacturing site, securing around 3,300 jobs and supporting thousands more across the wider supply chain. The deal strengthens the UK’s sovereign defence capabilities while offering stability for one of the country’s key advanced manufacturing hubs.

Utilities

• The UK government has cut subsidies for renewable power generators by tying support to the lower Consumer Prices Index (CPI) rather than the higher Retail Prices Index (RPI), a move designed to save taxpayers an estimated £270 million a year, but which reduces returns for green energy producers and could slow investment in clean power. The change reflects tightening fiscal priorities amid broader market and policy pressures on the energy transition, potentially dampening investor enthusiasm just as the sector grapples with decarbonisation goals and infrastructure costs.
• Ofgem has confirmed a 7% cut to the energy price cap for the April to June period, reflecting lower wholesale gas prices and easing network cost pressures. This is set to reduce the typical dual-fuel bill from £1,758 to £1,641, saving households roughly £117 per year, although bills remain well above pre-energy crisis levels.
• Britain is in a stand-off with France over how the costs of planned new power cables under the Channel should be shared between consumers on each side. The two countries already have three interconnectors with a combined capacity of about four gigawatts, and a further one gigawatt link has been proposed to deepen cross-Channel trade in electricity. However, in February 2026 the UK and French regulators said the conditions were not yet met to approve the project.
• In February, the UK government announced a record package of subsidies for new solar power capacity as it pushes towards its goal of decarbonising the power sector by 2030. Through the latest Contracts for Difference auction, it awarded support for 4.9 gigawatts of planned new solar farms, alongside 1.3 gigawatts of onshore wind and 21 megawatts of tidal stream projects, marking the strongest round yet.
• Four of the UK’s largest energy suppliers – British Gas, EDF, E.ON and Octopus – are set to trial “low or no standing charge” tariffs from April. These are designed to help low-usage households by shifting more of the fixed daily cost into the unit rate, reducing upfront standing charges but potentially increasing per-unit prices. The tariffs will sit outside the default price cap framework, meaning overall value will depend on individual consumption levels.
• French utility company Engie agreed a £10.5 billion acquisition of UK Power Networks in February from Hong Kong-based CK Infrastructure Holdings. The UK’s largest electricity distribution operator is set to come under the control of Engie, which will expand its regulated network footprint in Britain.
• Conflict in the Middle East following the US-Israel war is threatening to send UK energy prices spiralling. In light of the escalation, shipping across the Strait of Hormuz – a vital route that transports roughly 20% of global oil supply and LNG trade – has faced disruption, with European gas prices climbing an estimated 18-28% by 2 March, according to Smart Energy estimates. While the UK isn’t directly reliant on energy imports from Iran, it is closely integrated with European gas markets, meaning any uplift in continental wholesale prices is likely to translate into higher UK gas and electricity prices.

Construction

• Deloitte’s Regional Crane Survey shows UK construction shows signs of resilience heading into 2026, with new project starts increasing across key regional cities – Belfast, Birmingham, Leeds and Manchester – as the number of schemes rose to 53 in 2025 from 47 in 2024, though total units and floorspace under construction dipped slightly. Residential, student accommodation, hotel and office refurbs are driving activity, indicating a healthy forward pipeline and developer sentiment has shifted towards “committed construction” amid strategic public and private investment. Despite challenges like higher costs and regulatory pressures, the outlook for offices, residential and specialised sectors appears more positive for 2026.

• Begbies Taynor Group finds UK construction firms are facing growing financial stress, with the number in “critical distress” rising by nearly 50% in 2025. The surge reflects tight margins, rising costs and project delays, which have pushed more companies into severe financial difficulty, threatening jobs and supplier relationships across the sector. While some parts of the UK construction pipeline remain resilient with continued starts in residential, retrofit and public projects, the sharp increase in distressed companies highlights fragilities in the industry’s financial health and suggests a tougher operating environment ahead for contractors, especially smaller and mid-sized businesses. The trend underscores the need for stronger cash-flow management and risk mitigation as demand patterns evolve.

• UK construction activity showed tentative signs of stabilisation at the start of 2026, with the construction PMI rising to 46.4 in January 2026 from 40.1 in December 2025, a reading that had marked a five-and-a-half-year low. While the latest figure remained below the neutral 50 threshold, it represented the strongest reading since May 2025, suggesting the pace of decline is easing. Improving sentiment was partly linked to lower borrowing costs and reduced uncertainty following the Budget, though output growth remained constrained by elevated cost pressures.

• A survey carried out by the Local Government Information Unit and Scape reveals growing strain in the public-sector construction pipeline. Almost two-thirds (64%) of senior council officers report that construction projects are being delayed, while 40% do not believe their local authority is well placed to follow through on planned schemes. The findings underline delivery risks at a time when councils are grappling with funding uncertainty, capacity constraints and skills shortages.

Wholesale Trade

• According to the Office for National Statistics, output in the wholesale and retail trade; repair of motor vehicles and motorcycles increased by 0.6% in December 2025. This was driven by a 1% rise in wholesale trade, except for motor vehicles and motorcycles.

• Lynas Foodservice, one of the largest family-run foodservice distributors across Northern Ireland, the Republic of Ireland and Scotland, has announced the acquisition of Scotland’s leading independent foodservice wholesalers, JB Foods. The move boosts Lynas Foodservice’s reach in Scotland.

• The Grocer’s Big 30 Wholesaler report highlights significant inflationary pressures faced by some of the country’s leading wholesalers, despite overall expansion in profit margins thanks to recovering hospitality sector and inflation-driven menu pricing. It reports several large wholesalers having negative profit growth, including Henderson Wholesale (-38%), JJ Foodservice (-23.8%), Holdsworth (-38.7%), LWC (-52%) and Lioncroft (-115%).

• Leading UK wholesalers, Parfetts and J.W. Filshill, have adopted a new AI-driven platform, Wholepal, to modernise technical product data sharing across the supply chain. The tool removes manual new line forms, accelerating routes to market for wholesalers, as reported by WholesaleManager.

• Finlay’s Food, which was acquired in 2024 by the UK’s largest bakery wholesaler, BAKO Group, has been rebranded as Bako. It supplies products to customers in the Republic of Ireland, Northern Ireland, the UK, Europe and Asia.

• AF Blakemore, a wholesaler to Spar retailers and other food, retail and hospitality brands, has reported a dip in revenue in the year ending April 2025, while also recording its first operating profit loss since 2022, citing high food inflation, subdued consumer confidence and reduced demand for products like tobacco, vapes and alcohol.

• Bestway Wholesale has launched its Easter 2026 campaign, called ‘Buzz About the Sweetest Deals’, across over 60 depots, in an attempt to boost sales for independent retailers during one of the busiest retail periods during the year.

Retail Trade

• In early March 2026, the British Retail Consortium (BRC) reported that shop price inflation eased to 1.1% year-on-year in February, down from 1.5% in January, largely due to intense competition among retailers and widespread promotions in sectors like health, beauty and fashion, which helped keep price rises in check. Non-food prices fell 0.1%, while food inflation slowed to 3.5%, with ambient food inflation at its lowest in four years (2.3%) despite fresh food still rising 4.3%. The data suggests competition is tempering overall price growth and offering some relief for cost-conscious consumers, although the BRC cautioned that prices are still rising and retailers face ongoing cost pressures that could affect profit and future pricing.

• In response to the Spring Forecast 2026, the BRC warned that retailers remain under significant pressure despite improving headline economic indicators. While inflation is easing and interest rate expectations have stabilised, the BRC highlighted that retailers face mounting costs from April, including increases to the National Living Wage and higher employer National Insurance contributions yet again. The organisation cautioned that these additional burdens risk undermining investment, job creation and store viability at a time when consumer confidence remains fragile. The BRC stressed that retail operates on tight margins and urged the government to avoid more cost increases, warning that sustained pressure could translate into higher prices, reduced hiring and continued strain on high streets across the UK.

• In early 2026, UK consumer confidence showed a modest improvement, according to the latest BRC–Opinium survey, with expectations for the economy rising to -32 (up from -38) and personal financial outlook improving to -4 (from -10). Expectations for personal retail spending increased to +8 (from +6), while overall spending intentions rose to +20. Despite this gradual uplift, confidence remains firmly negative overall, reflecting continued caution among households amid cost pressures and economic uncertainty. For the retail sector, the marginal gains suggest tentative stabilisation in demand, but subdued sentiment indicates that spending growth is likely to remain fragile, limiting retailers’ ability to rebuild margins or commit confidently to expansion and investment.

• The BRC warned in early 2026 that rising employment costs, including increases to the National Living Wage and higher employer National Insurance contributions, are putting significant retail jobs at risk. The BRC said the sector faces £5 billion in additional annual costs, forcing many retailers to review hiring plans, reduce hours or cut roles, particularly given already tight margins and weak consumer demand. Separately, the BRC cautioned that proposed changes to collective redundancy rules must remain pragmatic, arguing that more rigid requirements could delay restructuring, increase administrative burdens and ultimately threaten business viability. Together, higher employment costs and stricter redundancy processes risk accelerating store closures, reducing workforce flexibility and intensifying pressure on UK high streets.

Transportation & Warehousing

• TfL has confirmed an update to the London Congestion Charge, which will rise from £15 to £18 from January 2026. As part of the overhaul, electric vehicles will lose their full exemption. Electric cars will qualify for a 25% discount, while electric vans, HGVs and quadricycles will receive a 50% discount when registered for Auto Pay.

• The UK is tightening road safety enforcement by expanding roadside drug testing, alongside proposals like mandatory eye tests for drivers over 70 and lowering England’s drink‑driving limit. This comes amid a push to cut traffic deaths, with 1,602 people killed on British roads in 2024, as reported by the Financial Times.

• Newmark’s latest analysis suggests the UK warehousing market has moved past its “cyclical peak” in supply, with availability easing in late 2025 as occupier confidence improved and demand remained resilient. In Q4 2025, the UK availability rate fell to 7.6%, while take-up totalled 12.2 million square foot (sq ft) – above the 10-year pre-pandemic quarterly average – alongside subdued speculative development of 11 million sq ft in 2025 (the lowest since 2017). Newmark also notes occupiers are increasingly prioritising warehouse configuration, automation-readiness and power connectivity.

• An article published in the Financial Times in February revealed how major airlines are “locked in battle” with Heathrow as the airport pushes ahead with a £33 billion plan to build a new runway and terminal. Airlines are concerned that Heathrow’s regulated funding model allows capital spending to escalate with limited discipline, pushing up charges that are passed through to carriers.

• Channel Tunnel freight trains are set to restart after Network Rail agreed to take control of and invest £15 million in the Barking Eurohub terminal in east London. The route has been dormant since 2024 after its previous operator withdrew, halting regular through-freight services between the UK and continental Europe. The line has the capacity to carry the equivalent of around 100,000 lorry journeys a year, easing pressure on UK roads and cutting emissions.

• Millions of commuters across the country are benefitting from a freeze on regulated rail fares for the first time in 30 years, which took effect in March 2026. The measure is projected to save passengers around £600 million, with more than one billion journeys a year expected to benefit from the cap.

Accommodation & Food Services

• ONS data reports that output in accommodation and food service activities climbed by 0.03 percentage points in December 2025 and overall by 0.04 percentage points in 2025. Food and beverage service activities output climbed by 1.5% in the three months to December 2025, while accommodation was down 2.9% over the same period. Meanwhile, food and beverage service activities output was the largest positive contribution in consumer-facing services in December 2025, with growth of 1.6%.
• The UK competition watchdog, the Competition and Markets Authority, has opened a probe into Hilton, IHG, Marriott and data provider CoStar over alleged sharing of commercially sensitive information through hotel analytics platform STR (which collects data from about 90,000 hotels globally), to guide pricing and other commercial decisions. Regulators are examining whether the use of this shared data may have weakened competition by making it easier for rival hotel groups to anticipate each other’s moves and align their behaviour, potentially undermining price rivalry.
• UKHospitality Scotland has called for all political parties to include a commitment to introduce permanently lower business rates for hospitality in their manifestos, ahead of the elections in May. It states that, if properly supported, the sector can create an additional 46,000 jobs and add £2.4 billion to the economy by 2031.
• According to the "Hospitality and the Night Time Economy: The state of play in 2026” report by NIQ and the Night Time Industries Association, the UK’s late-night economy continued to shrink in 2025, but cocktail‑led venues emerged as a rare growth story, with cocktail bars, craft bars and themed bars all expanding and now sitting well above pre‑pandemic levels. Overall, late‑night venue numbers fell 4.1% in the year to December and are 28.2% below March 2020 levels, contributing to tens of thousands of job losses, while the wider hospitality estate also contracted.
• More than 200 signatories from leading accommodation providers like Haven, Travelodge, Whitbread, IHG Hotels & Resorts and Parkdean Resorts have warned that the proposed Visitor Levy in England, which could mean Brits face an extra £100 or more for a two-week domestic holiday, could put jobs at risk and result in loss of money as some families opt for shorter trips, skip domestic travel altogether or take trips abroad instead.
• Lingering financial challenges faced by consumers have meant that many have cut back on out-of-home dining. As a result, food establishments have begun offering heavy discounts to entice spending, despite the negative impact this could have on their profit margins, as noted by the Financial Times. NIQ’s data tracker, alongside RSM UK, has shown that restaurants’ like-for-like sales contracted in 10 months in 2025.
• At the start of March 2026, BrewDog shut 38 UK bars with immediate effect after the business went into administration and was sold in a £33 million rescue deal to US group Tilray Brands, resulting in 484 redundancies across England, Scotland and Wales. The sale preserves the BrewDog brand, its Ellon brewery and 11 venues in the UK and Ireland, safeguarding around 733 jobs.
• According to RSM Hotels Tracker, based on data by Hotstats, the UK hotel occupancy rate climbed from 72.5% to 73.6% in December year-on-year, though the rate in London dipped from 82% to 81.4%. Average daily rates and revenue per available room across the UK also climbed, gross operating profit took a hit year-on-year, as cost pressures have outweighed resilient demand and higher room rates.
• Knight Frank’s latest UK Hotel Trading Performance Review has found that wellness-focused amenities like leisure clubs, spas and health facilities were a major factor behind robust UK hotel trading in 2025, despite wider economic pressures. Hotels with strong leisure and wellness offerings saw higher leisure spend per occupied room and have almost doubled average guest spend since 2019, helping to sustain room rates and profitability. London achieved an average occupancy rate of 82.5%, a 1.2% increase year-on-year.

Information

• ONS data reports that output in the information and communication subsector fell by 0.5% in December 2025, following a 0.9% dip in October 2025. This fall was driven by a 2% fall in computer programming, consultancy and related activities, which was the largest negative contribution from a single industry. However, information and communication output climbed by 0.4% in the three months to December 2025, driven by growth in motion picture, video and television programme production, sound recording and music publishing activities (up 8.5%) and information service activities (up 8%). Further, the subsector posted the largest positive contribution to UK GDP growth in 2025, rising by 4.5%.

• BT reported losing 210,000 customers in the last three months of 2025; however, this was less than initial expectations of 239,000, which the company has stated points towards a stabilising competition in the broadband market.

• At the techUK Future Telecoms Conference 2026, the Minister for the Digital Economy, Liz Lloyd, confirmed £1.8 billion public funding under Project Gigabit to reach hard‑to‑serve areas and reiterated the goal for 99% of UK premises to have access to gigabit‑capable broadband by 2032, up from around 86% in 2026.

• Ofcom has approved Virgin Media O2’s push for mobile calls via satellite, allowing the company to launch its O2 Satellite service, which will use Starlink’s low-Earth orbit satellites to connect directly to 4G smartphones in the UK. From 25 February 2026, Ofcom’s D2D regulations come into force, allowing UK mobile network operators like Virgin Media O2 to integrate satellite connectivity into consumer devices without extra end‑user licences.

• Virgin Media O2 has announced in February 2026 that it is extending its partnership with Zinkworks to deploy AI-driven automation technology across its mobile network to minimise downtime, following proven results in its fixed broadband segment, where automation has significantly reduced repair times and the need for engineer visits.

• New Ofcom figures show around 532,000 UK households are now on “social” broadband and mobile tariffs, designed for low‑income customers and often priced below mainstream offers.

• The Financial Times reports that US private equity group Ares is injecting £115 million into UK broadband provider TalkTalk, replacing a maturing £47 million debt facility and shoring up the company’s balance sheet as prospective buyers examine takeover options. The deal underlines both the financial strain facing mid-tier UK telecoms operators and the continued appeal of digital infrastructure assets to private capital.

• In February 2026, the Competition and Markets Authority and Ofcom launched an inquiry into the £500 million merger between the Daily Mail and the Telegraph.

• The UK is set to extend the Online Safety Act to cover a loophole in relation to AI chatbots, in response to the recent deepfake scandal involving the Grok chatbot on the social media platform X.

• The Financial Times reports that the BBC is planning to trim its budget by hundreds of millions of pounds, resulting in job losses and impacts on future programming. This is part of the broadcaster’s plan to cut costs by 10% over the next three years.

• Failed talks with The Exploration Company, a European space start-up, have resulted in Scottish rocket maker Orbex collapsing. This follows earlier failure to secure UK government funding, with the 160-strong staff company falling into administration.

• The UK government plans to force major tech platforms to remove abusive images, including non-consensual intimate content, within 48 hours or face the threat of being blocked in the country. The move, part of new online safety measures, sharply raises compliance demands on social media, cloud and hosting providers, compelling them to invest more heavily in moderation systems, AI detection tools and legal oversight for UK users.

Finance & Insurance

• Zurich Insurance Group has agreed terms to acquire Beazley in a deal valued at £8.1 billion, marking a major consolidation in the insurance market. The agreed takeover will combine Zurich’s global scale with Beazley’s strength in specialist and Lloyd’s market underwriting, subject to regulatory and shareholder approvals. The transaction reflects continued strategic consolidation across the insurance sector as companies seek scale, diversification and stronger underwriting capabilities amid rising claims costs and evolving risk landscapes. For the UK insurance and financial services sector, the deal could reshape competition in speciality insurance and reinforce London’s role as a global insurance hub, while potentially prompting further mergers as insurers pursue growth and operational efficiencies.

• Aviva reported that its 2025 technology investment programme has improved operational efficiency and service speed across the business. According to Rebecca Gambrell, investment in digital platforms, automation and upgraded systems has enabled faster customer service responses and improved internal processes. The insurer has prioritised modernising its technology infrastructure to streamline claims handling, enhance data capabilities and support more efficient operations. The move reflects a broader shift towards digital transformation as insurers invest heavily in technology to improve productivity, customer experience and competitiveness while managing rising operational and claims costs.

• UK house prices rose in February 2026, signalling a modest rebound in the housing market ahead of the government’s spring forecast. Data from Nationwide Building Society showed prices increased 0.7% month-on-month, lifting the average UK house price to £260,420, though growth remained subdued compared with previous years. The rise reflects improving buyer confidence as mortgage rates stabilise, despite ongoing affordability pressures. However, economists warn the outlook remains uncertain as Rachel Reeves prepares the government’s fiscal update. The uptick suggests tentative market recovery, but demand is still constrained by borrowing costs and wider economic uncertainty.

• UK consumers are increasingly turning back to credit cards, reflecting mounting pressure on household finances. Data from the Bank of England shows net credit card lending rose 12.4% year-on-year in December 2025, pushing outstanding balances to some of the highest levels in years. The trend reflects households relying more on short-term borrowing to manage everyday spending as living costs remain elevated and savings buffers weaken. While credit cards offer flexibility and rewards, rising borrowing also increases exposure to high interest rates if balances aren’t cleared. The resurgence signals stronger consumer credit demand for lenders but raises concerns about household debt sustainability and potential repayment risks if economic conditions deteriorate.

Real Estate and Rental and Leasing

• According to Nationwide, annual house price growth increased by 1% in February 2026 compared with February 2025. Prices climbed by 0.3% month-on-month and the average house price stood at £273,176. The company reports that improved affordability and an easing in credit availability have helped to support first-time buyer activity, with mortgage completions up 18% year on year in 2025.

• Property portal Rightmove reports that the average price of newly listed homes in Britain has remained steady in February 2026, but was up 2.8% since December 2025.

• A survey by the Royal Institution of Chartered Surveyors shows somewhat improved housing market conditions, with a net balance of 15% of professionals reporting a fall in new buyer enquiries in January 2026, an improvement on December’s figure of 21%, though still negative.

• UK mortgage approvals slipped to a two-year low in January, underlining the continued cooling of the housing market as higher borrowing costs and subdued buyer confidence weigh on demand. Net approvals for house purchases fell for the fourth consecutive month to 60,000 in January 2026, down from 61,000 in December 2025.

• Despite rising prices for houses nationally, data by the Land Registry reports that UK flat prices dipped 0.5% in 2025, driven by a sharp drop in the London market amid buyers put off by high service charges, lack of space and affordability pressures in the capital.

• The Financial Times reports that the UK’s planned “mansion tax” on properties worth more than £2 million is already reshaping the housing market, with sellers clustering asking prices just below the threshold to avoid the new annual levy.

• According to CBRE data, capital values for UK commercial real estate remained flat in January 2026. Rental values also remained flat, while month-on-month total returns stood at 0.5%. Capital values for the Office sector decreased by 0.3% in January 2026, while the Industrial sector saw capital values climb 0.2%. Total returns for Retail stood at 0.5%, 0.1% for Office and 0.6% for the Industrial sector.

• CBRE has reported a strong UK Operational Real Estate market in 2025, with total investment volumes reaching £18.8 billion, a 78% hike from 2024. In Q4 2025, transactions reached £12.3 billion. Its report highlighted healthcare assets for their strong performance, accounting for 69% of total investment volumes. Hotels also recorded robust growth over the year.

• CBRE’s Real Estate Market Outlook 2026 reported that provisional take-up of office space in Central London stood at 11.4 million square foot in 2025, with similar levels of take-up expected in 2026. Meanwhile, it forecasts that take-up in the regional markets will dip by 11% in 2026. Nonetheless, supply side constraints are expected to drive prime rental growth in London and in regional office markets. The report also points out “tight grade A vacancy in core markets”, which “will shift many large occupiers’ requirements towards good quality space in more peripheral locations”. It also states that it expects “long-term bond yields to remain elevated” in 2026 and forecasts net total returns of around 8.5% for 2026 when aggregating across different real estate segments.

• In February 2026, Coutts’ Prime Property Index has found that Central Property prices are 10.3% below their 2014 peak, with an average discount of 10.3% being negotiated for prime property in the capital.

• US tech giant Microsoft is reportedly scouring central London for a new headquarters of up to 250,000 square feet along the Elizabeth line, signalling renewed confidence in the capital’s office market despite subdued post-pandemic demand.  

Professional, Scientific & Technical Services

• ONS data reports that output in professional, scientific and technical services remained flat in December 2025. However, the subsector was the largest negative contributor to services output in the three months to December 2025, falling by 1.1%. This was driven by falls in accounting, bookkeeping and auditing activities; tax consultancy (down 5.1%) and advertising and market research (down 4.1%).
• UK top 20 accounting firm Xeinadin, which has recorded substantial growth in recent years thanks to significant acquisition activity, has failed to attract a buyer at its £1 billion price tag. According to the Financial Times, this could potentially signal a waning “investor appetite in professional services” and potential overvaluations in the segment. In February 2026, Xeinadin acquired TBL Accountants, expanding its Southend office and strengthening its advisory support for small businesses and charities in Essex.
• The UK’s accounting watchdog, the Financial Reporting Council, is weighing a relaxation of strict audit inspection rules to lure more Chinese companies to list in London and boost the capital’s market, amid intensifying competition with rival financial centres.
• Deloitte is undertaking a major overhaul of its global structure, merging its European and Middle Eastern operations into a single regional business. The restructuring aims to streamline decision-making, improve investment in technology and new services and better compete with rival Big Four and consulting groups at a time of rising regulatory scrutiny and cost pressures.
• Arbitration is increasingly being used to settle divorce finances in England and Wales, with cases handled through the Institute of Family Law Arbitrators doubling from 89 in 2023 to 178 in 2025 as couples try to avoid delays in an overstretched court system. The rise follows a 2024 rule change requiring separating couples to consider alternative dispute resolution before going to court.
• New analysis by the Ministry of Justice reveals that, despite the government’s overhaul of the system, including the abolition of jury trials, the backlog of criminal cases in England and Wales would rise from about 80,000 now to roughly 100,000 by 2028 and still be higher than current levels by the end of the decade.
• The latest Advertising Association/WARC Expenditure report has found that UK advertising spend rose by 11.4% to £12.5 billion in Q3 2025. Total ad spend is estimated to have risen by 10.1% to £46.9 billion during 2025 as a whole and is set to rise a further 7.5% to exceed £50 billion in 2026. TV VOD is forecast to see the most growth (13.8%) in 2026, boosted by major sporting events like the FIFA World Cup. Search (10.2%), online display (8.4%) and online radio (7.3%) are set to continue recording gains.
• The Institute of Practitioners in Advertising reports that UK advertising agencies recorded a 14% dip in 2025, driven by the rollout of AI tools that reduce or replace the need for staff, as reported by The Guardian.

Education

• During National Apprenticeships Week in February 2026, Universities UK (UUK) highlighted the growing role of higher and degree apprenticeships in widening participation and supporting employer skills needs. UUK noted continued expansion in apprenticeship routes delivered by universities, enabling learners to gain qualifications while earning and helping address shortages in sectors like health, engineering and digital.

• The sector has raised concerns about funding pressures and the need for greater flexibility in the Apprenticeship Levy to maximise uptake. The focus underscores a strategic shift towards vocational and employer-aligned provision, strengthening university-industry collaboration while also intensifying debate over sustainable funding and long-term skills policy.

• The response from UUK to the UK rejoining the Horizon Europe research programme welcomed the move as a major boost for UK science and higher education collaboration. UUK said renewed participation restores access to one of the world’s largest research funding programmes, supporting international partnerships, innovation and talent mobility across universities.

• The UUK has highlighted that UK researchers previously secured significant funding through Horizon schemes and that re-entry should help stabilise research investment following years of uncertainty after Brexit. The development strengthens universities’ global competitiveness, supports large-scale collaborative projects and could improve funding opportunities, though institutions will need time to rebuild partnerships disrupted during the UK’s absence.

• The Department for Education (DfE) has said schools in England can only afford a 2.7% pay rise for teachers over the next two years within existing budgets, highlighting ongoing funding pressures across the education sector. The figure, outlined in evidence to the School Teachers’ Review Body, reflects tight school finances as rising costs for energy, staffing and support services continue to strain budgets. Education leaders warn that the proposed increase may struggle to support recruitment and retention, particularly amid existing teacher shortages and workload concerns. Limited pay growth risks worsening staffing pressures and could intensify disputes over funding, potentially affecting school capacity and the quality of teaching provision.
• A new proposal by Tom Richmond (a Civil Servant and current education author) and Dr Tilly Clough suggests the Department for Education (DfE) should support struggling private schools to convert into academies to help maintain school places and protect jobs. The idea comes as a growing number of independent schools face financial pressure from rising costs and potential policy changes, including the introduction of VAT on private school fees. Advocates argue that enabling financially distressed private schools to join the state-funded academy system could prevent closures, safeguard local education provision and make use of existing facilities. The proposal highlights increasing financial strain within the independent school market and raises questions about capacity, funding and integration between the private and state education systems.

Healthcare & Social Assistance

• A government ban on recruiting new overseas care workers, introduced in summer 2025 to reduce net migration, risks triggering care home closures, sector leaders have warned. Raj Sehgal, who runs six Norfolk homes and sits on the National Care Association board, said his firm is “exceptionally reliant” on international staff and that services may shut if they “can’t employ people”.

• Although adult social care vacancies fell from 126,000 to 111,000 in the year to March 2025, recruitment remains acute, particularly in rural areas. With most roles paid at the £12.71 minimum wage for over-21s, providers say low pay and rising costs deter UK applicants. The Home Office says the policy will strengthen domestic recruitment, but companies warn it could deepen workforce shortages and destabilise already fragile provision.

• The King’s Fund said the proposed GP contract for 2026-27 offers some welcome investment but is unlikely to resolve mounting pressures in primary care. While the deal includes additional funding and aims to support access improvements, it comes amid rising demand, workforce shortages and growing patient need. The think tank warned that without a longer-term workforce plan and sustained capital investment, the contract risks being a short-term fix rather than a structural solution.

• General practice is facing record appointment levels alongside recruitment and retention challenges and the King’s Fund has stressed that stabilising GP services is critical to easing pressure across the wider NHS. For the health and social care sector, the agreement provides limited relief but underlines ongoing capacity and funding constraints in frontline care.

• UK pharmaceutical M&A activity stalled in 2025, while the biotech sector showed resilience and growth, according to EMJ. Larger pharma companies adopted a cautious approach amid macroeconomic uncertainty, higher borrowing costs and regulatory scrutiny, leading to fewer big-ticket acquisitions and a slowdown in deal volume. In contrast, biotech firms benefitted from targeted investment, innovation in areas like advanced therapies and oncology and strategic partnerships. The divergence highlights a more selective investment environment across life sciences. Subdued pharma M&A may dampen large-scale consolidation and capital flows, but biotech strength signals continued investor appetite for innovation-led growth and niche, high-value research pipelines.

• According to NHS figures, a record 18.4 million treatments and operations were carried out last year, up from 18 million in 2024. As a result, the national waiting list has fallen to 7.29 million, its lowest level since February 2023. The latest figures show the overall backlog declined as more patients were treated and fewer were added to lists, reflecting expanded diagnostic capacity, additional surgical activity and ongoing recovery plans. While the total remains historically high, the reduction suggests targeted investment and productivity measures are beginning to ease pressure on planned care services. The fall may help restore public confidence and reduce system strain, but sustained workforce capacity, capital funding and social care support will be critical to maintaining momentum and preventing future backlogs.

Arts, Entertainment & Recreation

• UK gambling revenue reached £4.3 billion, driven largely by growth in the remote (online) gambling sector, while overall participation remained unchanged at 48% of adults, according to 15 Min Mastery. The figures suggest that although more activity is shifting online, the total number of people engaging in gambling hasn’t significantly increased. Online platforms, particularly casino-style games, continue to account for a growing share of revenue, reflecting broader digitalisation across the sector. The trend highlights sustained financial growth in gambling alongside a structural shift towards digital channels, while stable participation rates suggest market expansion is being driven more by spending patterns than by new users.

• Proposed changes by the UK Gambling Commission would increase licensing fees for gambling companies, with the regulator arguing the rise is necessary to ensure it can effectively oversee the sector as it grows and becomes more complex. The adjustments are intended to fund enhanced regulatory activity, including compliance checks, enforcement and consumer protection measures. Industry stakeholders have raised concerns that higher fees could increase operating costs, particularly for smaller companies, potentially affecting competition and market entry. The changes signal tighter regulatory oversight of gambling, which could strengthen consumer safeguards, but also add financial and administrative pressure on licensed operators.

• In January 2026, the UK government announced a £1.5 billion investment package aimed at restoring “national pride” by funding upgrades to local cultural, heritage and community assets across the country. The programme will support projects like the renovation of museums, theatres, sports facilities, parks and historic buildings, alongside improvements to town centres and public spaces. The funding is intended to revitalise local cultural infrastructure, boost tourism and increase community participation in arts and recreational activities. 

For more information on any of the UK’s 600+ industries, log on to www.ibisworld.com, or follow IBISWorld on LinkedIn.