Story perspectives

Unemployment Predicted to Rise Amid Business Confidence Drop

1/5/2026

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Summary

Story summary

The Resolution Foundation warns that unemployment could rise in 2026 due to the collapse of zombie companies and higher borrowing costs.
Unemployment reached 5.1% in October, the highest outside the Covid pandemic.
The British Chambers of Commerce reported a drop in business confidence, with many firms expecting lower turnover.
Despite signs of productivity growth from creative destruction, job impact remains concerning and fuels calls for action to protect living standards.

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Story summary

The Resolution Foundation warns that unemployment could rise in 2026 due to the collapse of zombie companies and higher borrowing costs.
Unemployment reached 5.1% in October, the highest outside the Covid pandemic.
The British Chambers of Commerce reported a drop in business confidence, with many firms expecting lower turnover.
Despite signs of productivity growth from creative destruction, job impact remains concerning and fuels calls for action to protect living standards.