Business News Round Up (16/10/2026)
UK businesses are battening down the hatches
Leading accounting and advisory firm MHA’s six-monthly survey of 400 finance directors (FDs) across the UK highlights the challenges that UK businesses are currently facing. In terms of ‘the highest priority for their business’, the latest edition of the MHA Finance Directors Business Confidence & Outlook report shows ‘profitability and efficiency’ while always an important consideration continues to rise further with three-quarters of FDs citing it as a high priority – up from 65% in 2025. The biggest challenges for UK businesses have also shifted. Under half of FDs cited inflation and cost pressures as a challenge in early 2025. That has risen to 64% today. Unsurprisingly technology and AI adoption is also moving quickly up their list of focus areas with 40% citing this as a major challenge up from just 15% only eighteen months ago and for the first time, has moved ahead of retaining talent as a priority.
Tens of thousands of Scottish workers set for a pay boost as real Living Wage increases
More than 76,000 people working for over 4,000 real Living Wage Employers in Scotland are set for a vital pay boost, as the voluntary real Living Wage rates rise to £14.10 an hour across the UK (65p or 4.8% increase). New figures show that the campaign for a real Living Wage has secured nearly £5bn of pay rises for low paid workers and made a profound difference to millions of lives around the UK since it began 25 years ago. Nearly £730m of that total is driven by employers in Scotland. Living Wage Foundation analysis shows that a full-time worker earning the new, real Living Wage would earn over £2,700 a year more than a worker earning the current government minimum. This extra cash could cover eight months of food for a household or five months of housing and energy costs.
Businesses cutting costs and squeezing margins as energy bills bite, says Bailey
Andrew Bailey has warned that British businesses are cutting costs and eating into their profit margins to cover rising energy costs. The Governor of the Bank of England said many businesses were reducing their headcount to avoid passing higher energy costs on to their customers. Speaking at the International Monetary Fund’s annual meetings in Bangkok, Mr Bailey said: “When I go around the country, I do a lot of talking to businesses. There’s a very big focus on cost-cutting and a very big focus on the difficulty of passing through (higher energy prices).” His comments come ahead of the Bank of England’s Monetary Policy Committee meeting early next month, when it will decide whether to raise interest rates to combat inflation, which has risen to 3.1% this year. New figures suggest it could hit 3.4% when September’s figures are released next week.
Britain risks losing wealthy families as Europe becomes increasingly attractive
Brexit made moving to Europe slower and far more bureaucratic, but it didn’t stop Britons going. By the end of 2025, almost 920,000 British citizens held residence permits in EU countries, making them the seventh-largest group of non-EU nationals living in the bloc. Some of those are long-standing residents protected under the withdrawal agreement, but the flow of new arrivals has never really dried up. EU countries issued more than 42,000 first-time residence permits to UK citizens in 2023, with Spain alone granting over 10,000. Spain now counts more than 382,000 UK nationals holding residence documents. Official estimates suggest around 136,000 more British nationals left the UK than arrived last year. Visa rules, the 90-day limit, residency thresholds and proof-of-income requirements have all raised the bar.