Financial insecurities putting UK workers off becoming their own bosses

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61% of employees across the UK aspire to work for themselves while 30% of aspiring entrepreneurs feel it’s too risky, says Vorwerk study.

London (68%) and the North East (66%) are where “entrepreneurial spirit” is at its highest, yet 56% of UK workers are being turned off pursuing their ambitions of becoming their own bosses due to lack of financial security, according to a Vorwerk study.

This is linked to the everyday stresses of mortgage payments and other bills, which are in turn preventing half of the population to take the risk and follow their dreams. 10% says their current roles are impacting their health.

Even with 61% of UK workers wanting to run their own businesses, 36% lack the confidence to start one, 30% feel it’s too risky and 32% don’t like the fact they would not know how frequent the work would be.

The top five barriers for UK workers not starting up their own businesses are:

  1. Lack of financial security (56%)
  2. Lack of confidence (36%)
  3. Uncertainty of work coming in (32%)
  4. Too risky (30%)
  5. Don’t know what to do (23%)

Thomas Henningsson from Vorwerk said: “It’s totally understandable that people are worried about the regularity of work and cash flow when it comes to going alone – but there are lots of inspirational people around who have done it and are now reaping the rewards.”

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£1 billion spent more than last year during Christmas period

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Kantar Worldpanel says that £1,054 was the average spend by households over the 12-week Christmas period to the 31 December.

The figures show supermarket sales increased in value by 3.8%. £1 billion pounds more than 2016 was spent during this period with a staggering £747 million being spent on the 22 December alone.

In terms of being the UK’s fastest-growing retailers, there is nothing to separate Aldi and Lidl, both growing sales by 16.8% year-on-year. Tesco was the fastest-growing of the big four supermarkets with an increase in sales of 3.1%.

Asda and Morrisons grew 2.2% and 2.1% in sales, respectively.

Online supermarket sales enjoyed their best Christmas yet (up 4.9% year-on-year).

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Jaguar Land Rover hits record sales

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The UK’s largest carmaker says it hit record sales in 2017 even with the first drop in six years in demand for new cars across Britain.

According to Jaguar Land Rover (JLR), 178,601 Jaguars were sold last year, which is a rise of 20% from the year before. Land Rover sales grew 2% to 442,508. Sales have more than tripled since 2009 and this news marks the seventh successive year of growth.

This is even more remarkable given the decline in demand for new cars across the UK in 2017, the first drop in over half a decade.

China was the most important region for the company, with sales reaching 146,399, up 23% year-on-year. This, along with growing demand in the US, has provided a safety net against the uncertainty of the UK’s position in the EU and Brexit.

JLR’s Sales Director, Andy Goss, said that though sales targets were delivered, the company still “[faces] tough times in key markets such as the UK”, particularly given the tax hit on diesel.

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Business and consumer demand for new cars declined in 2017

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Demand for new cars fell 6.8% last year, the first drop in six years.

Sales of business fleet purchases dropped as well by 4.5%. Total new car registrations fell 5.7% to just over 2.5 million cars.

This decline can be attributed to the unknown future of diesel/diesel levies and Brexit uncertainty, according to the Society of Motor Manufacturers and Traders (SMMT).

The CEO of the SMMT, Mike Hawes, said that 2017 was a “lacklustre” year and that further weakening is to be expected in the market for 2018.

Business registrations saw the biggest fall with a 7.8% decline. These figures are an issue, but even so, demand is still at a historically high level, says Mike Hawes.

UK manufacturing growth remains strong for end of 2017

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Britain saw the highest three-month manufacturing growth since 2014.

According to the survey, the Markit/Cips UK manufacturing Purchasing Managers’ Index (PMI) of factory sentiment showed activity recorded an average rate of 57 in the three months to December. This is the strongest recording in three-and-a-half years (since June 2014).

Though last month saw a dip to 56.3 from 58.2 in November, it remained well above the level of 50, which represents growth.

An increase in production is linked to an increase in orders over the last 18 months. Growth was strongest among producers of partly-finished goods; 54% of companies said they expect an increase in production throughout 2018.

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Government borrowing fell in November

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UK government borrowing dropped to £8.7 billion last month, down £0.2 billion, predominantly due to higher income tax receipts.

To date, the total borrowing figure for 2017 is £48.1 billion, which is the lowest recorded at this time of year for a decade.

The Office for National Statistics (ONS) figures showed that revenues from income and capital gains tax were up 6.2% in November from a year ago and 3.4% higher for the year to date.

In its latest review of the UK economy, the International Monetary Fund (IMF) downgraded its British growth forecast from 1.7% to 1.6% and told the Chancellor of the Exchequer, Philip Hammond, to control public borrowing more in case of a slow-down in the economy going forward.

Total public sector net debt, not including public sector banks, was at £1.73 trillion at the end of November, according to the ONS. This figure is down by £65.5 billion from the previous month due to a change in housing associations being recategorised from public to private sector.

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UK ranked ‘best country for business’ in 2018 Forbes list

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Forbes‘ annual rankings sees Britain top the list despite Brexit uncertainty still in the air.

The UK ranked in the top 25 in each of the categories judged, except for political risk. The country performed best in the categories of technological readiness (fourth) and the size and education of its workforce (third).

For 2018, the Forbes annual list judged 153 countries on 15 major factors. The financial services sector and US investment were major positives that were pivotal in the UK topping the list.

New Zealand, the Netherlands, Sweden and Canada were second, third, fourth and fifth, respectively. Ireland also appeared in the top ten in eighth place.

UK factories see biggest order books in nearly 30 years

Manufacturing
British factories are benefitting from an export boom as the pound weakens and demand from strong eurozone economies increases.

A survey by the Confederation of British Industry (CBI) shows that 42% of manufacturers increased output in the past three months. Only 11% said they decreased, while 28% said order books are busier than usual.

A separate survey by the CBI and Pertemps Network Group states that 51% are planning on hiring to meet the demand.

The strong jobs market can be linked to this. However, households are still under pressure as house prices are overpowering wages but the intensity has eased slightly. The IHS Markit Household Financial Index rose from 43.5 last month to 43.9 this month.

CBI Head of Economic Intelligence, Anna Leach, said of the findings: “As we head towards the end of 2017, UK manufacturers’ total order books remain at a near 30-year high, with export order books remaining at their strongest since the mid-1990s.

“While the lower level of sterling continues to support exporters, cost pressures remain intense. Businesses will expect to see the government’s Industrial Strategy make rapid progress next year to support manufacturing and the wider economy in every corner of the UK.”

UK unemployment rate lowest since 1975

Employment
This is correlated, however, with wages not able to keep up with the rate of inflation.

In the three months to the end of October, unemployment stood 4.3%, according to the Office for National Statistics (ONS). The same rate was for the previous period of the three months to September.

Weekly earnings have risen by 2.5% year-on-year in the three months to October but is lagging behind the British inflation rate of 3.1%.

This six-year high inflation rate sees import costs increase, which led the Bank of England increase in its key interest rate for the first time in a decade last month.

The ONS also stated that there was a drop of 56,000 in the number of people at work to just over 32 million, which was the biggest quarterly decline in just over two years.

1.4 million people were unemployed at the end of October, down 26,000 from the same period last year.

UK inflation rises to six-year high of 3.1%

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The six-year high was an unexpected leap and will force the Bank of England Governor, Mark Carney, to explain to Chancellor of the Exchequer, Philip Hammond, why the increase has occurred.

The Office for National Statistics (ONS) numbers show the figure has risen to 3.1% from October’s 3%, the highest it’s been since March 2012.

The government has set a consumer price index target of 2% with the promise that the Bank of England must contact Philip Hammond if inflation exceeds 3% or falls short of 1%. This will examine further the bank’s interest-rate setting Monetary Policy Committee (MPC).

Highlights are the rise in computer game prices and the fall in airway fares (from 13.4% to 10.4%) from the same period last year.

Food and non-alcoholic drinks picked up to 0.6% from 0.5% in the same period last year.

Consumers were also met with higher fuel costs this November with petrol rising 1.8 pence a litre month-on-month to 119,1 pence and diesel rising by 2.3 pence a litre to 122.8 pence.