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UK Edition
13th August 2025
 
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THE HOT STORY

UK jobs market cools as vacancies fall

Unemployment in the UK remains steady at 4.7%, according to the Office for National Statistics (ONS). However, pay growth has slowed from 5% to 4.6%, and vacancy rates have dropped by 44,000, marking the 37th consecutive decline. Suren Thiru, economics director at the ICAEW, noted that rising employer national insurance costs are impacting hiring. He stated: "The UK jobs market is facing more pain in the coming months." Recent reports indicate that recruitment intentions are at a record low, a situation that is particularly affecting young job seekers. Rachel Reeves, the Chancellor, defended Labour's job creation record but acknowledged the need for further progress.
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WORKFORCE

Over 3.5m people now exempt from finding a job

Data published by the Department for Work and Pensions (DWP) shows the number of Britons claiming Universal Credit with no requirement to look for work is up by a million since Labour came to power, and now stands at 3.7m people. The over-50s are driving the surge, with experts suggesting this is partly linked to the rising state pension age – more people in their mid-60s are now eligible for working age benefits – while rising unemployment and the worsening jobs market have also pushed more people onto benefits.

Public sector productivity failings costs UK £80bn

Research by EY suggests that declining productivity in the NHS and public services costs the UK economy £80bn annually. Since 2019, public sector output has fallen by 5%, while the private sector has grown by 3%. If productivity gaps persist, losses could reach £170bn by 2030. Peter Arnold, chief UK economist at EY, said: "If left unaddressed, [underperforming productivity] will continue to act as a drag on UK growth." Arnold added: "With public sector spending now accounting for 44% of GDP, a more productive public sector is vital to achieving better productivity and a stronger UK economy."

Students struggle to meet living costs

According to the Higher Education Policy Institute, students in England must work over 20 hours weekly to maintain a basic standard of living. The report indicates that a student requires £61,000 over three years, or £77,000 in London, to achieve this, excluding tuition fees. The findings highlight the financial pressures faced by students, with many struggling to balance work and study. The report highlights the need for better support systems to help students manage their living costs effectively.
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RISK

Foreign Office jobs swap scheme under fire

An environmental charity called The Corner House is threatening legal action against Foreign Secretary David Lammy unless he can demonstrate that a planned job swap between BAE Systems employees and the Foreign Office would not allow industry staff to influence policy or legislation. The Corner House, which has instructed lawyers at Leigh Day, questions the scheme’s lawfulness, with a key concern being that the programme could hand staff "improper influence" over Britain’s policy towards Israel. Shell would also be involved in the plan to swap jobs with diplomats in Whitehall. A Foreign Office spokesman said: "We strongly reject these suggestions and make no apology for striking new partnerships with British businesses to harness their expertise, champion their interests overseas and drive growth for the British public."
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LEGAL

Ecctis sues ex-CEO for £6m

Ecctis, an organisation that provides services for the recognition and evaluation of international qualifications and skills, is suing its former chief executive, Cloud Bai-Yun, for £6m, alleging a breach of fiduciary duty. The company claims Bai-Yun improperly used profits from a not-for-profit government contract to pay herself £17.587m for her shares in 2021. Bai-Yun, who served as CEO from 2014, denies the allegations. The legal action follows a Department for Education audit which revealed Ecctis had failed to reinvest profits, leading to a £13.64m repayment to the government.

Sergeant sues RAF over promotion bias

Sergeant Haylee Curtis is suing the RAF for discrimination after a key fitness test was cancelled due to her pregnancy. The cancellation, which occurred three days before the scheduled test, has had lasting effects on her career and earnings. Curtis has received permission to pursue her case against the Ministry of Defence following a successful appeal at the Employment Appeal Tribunal.
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ECONOMY

UK retail sales rebound in July

UK retail sales rose 2.5% year-on-year in July, aided by warm weather, the Euros football campaign, the British & Irish Lions rugby tour, and increased discretionary spending, including live events and nostalgic toys. The growth, above the 12-month average of 1.9%, was driven by food, clothing, homewares, and appliances. However, the British Retail Consortium warned the rise "barely touched the sides" due to inflation, higher wages, and tax pressures. Barclaycard data showed discretionary spending up 2.4%, but essentials down 0.7%, with consumer confidence in personal finances steady but outlook on the wider economy falling to its lowest since January. Analysts noted that inflation and rising business costs continue to challenge retailers despite higher wages boosting disposable incomes. The BRC cautioned that proposed tax increases by Chancellor Rachel Reeves could trigger job losses and shop closures.
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CYBERSECURITY

M&S restores click and collect post-hack

Marks & Spencer has reinstated its click and collect service 15 weeks after suspending it due to a major ransomware attack on April 25 that halted online orders and disrupted in-store operations. The cyber incident, linked to the Scattered Spider collective, also led to stolen customer data and an estimated £300m profit hit for the year. CEO Stuart Machin told investors the retailer would recover by August. Customers are urged to remain vigilant against phishing attempts, and M&S now allows online returns at any store. Four arrests have been made in connection with the attack.
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INTERNATIONAL

Histadrut labour union won't join general strike

Israel's main labour union will not join a general strike called for Sunday to protest the government's approval of a plan for a military takeover of Gaza City. However, Histadrut said it would support workers who plan to take part that day. The decision followed a meeting between Histadrut chairman Arnon Bar-David, senior business sector figures, and representatives of the families of hostages who are leading the call for the strike. Bar-David said: “If I knew that a strike - not just for one day but longer - would end the matter, stop the war and bring back the hostages, I would go for it with full force . . . Unfortunately, and although my heart is bursting with anger, it has no practical outcome.”

Indian workers fear economic downturn due to US tariffs

India's textile, jewellery, and auto parts sectors face severe challenges due to US President Donald Trump's new 50% tariffs on Indian exports. Jagdish Prajapati, a diamond worker, expressed concern over job losses and economic strain, saying: "If the tariffs come, it will leave families struggling to make ends meet." The tariffs, effective from August 27, threaten to disrupt nearly $87 bn in annual exports to the US, which account for about 2.5% of India's GDP. Industry leaders warn of significant job losses and increased costs for Indian goods in the US market.
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OTHER

UN plastic pollution treaty discussions falter

There are just two days left for UN countries meeting in Geneva to negotiate a treaty on tackling plastic pollution. The talks remain deadlocked after a stalled first week, which fell behind schedule and produced no clear text.  "We have to speed up negotiations," said EU environment chief Jessika Roswall, who observed: "With . . . days to go, we have more square brackets in the text than plastic in the sea." A US-led alliance wants the treaty to address only plastic pollution; an EU-led bloc is seeking to include limits on production.
 
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