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The U-Turn on Redundancies and Offshoring The vocational training body City & Guilds has guaranteed that plans for mass compulsory redundancies and the offshoring of hundreds of UK jobs to Greece will no longer go ahead. The Initial Proposal and Backlash The proposal to remove about 400 UK roles was first reported by the Guardian in December as part of a £22m cost-cutting drive after the acquisition of the charity’s training and awards business by the Greek-owned PeopleCert in October. A presentation prepared for PeopleCert investors had said staff leaving UK roles would be replaced with people abroad. After the sale, about 75 compulsory redundancies were announced. The Financial Impact The union Unite said negotiations with PeopleCert had “secured a financial settlement for the limited number of workers currently being made redundant”, meaning compulsory job losses had been largely avoided. The Impact on City & Guilds and PeopleCert The strategy caused widespread dismay within the training sector and left City & Guilds facing potential legal and industrial action. However, on Thursday the union Unite said negotiations with PeopleCert had secured a financial settlement for the limited number of workers currently being made redundant. The Future Outlook Peter Storey, a regional officer at the union, said: “Unite will remain vigilant of the future direction of travel at City & Guilds under PeopleCert.” A spokesperson for City & Guilds added: “Measures have been agreed to minimise the impact on affected colleagues, maximise opportunities for redeployment and voluntary redundancy, and provide enhanced financial and practical support for those whose roles are ultimately confirmed as redundant.

The latest Office for National Statistics figures show a headline drop in the UK unemployment rate, yet deeper labour‑market indicators reveal a fragile recovery that could be derailed by the ongoing Iran war and looming price shocks.Unemployment Drops Yet Labour Market Remains Fragile Amid Iran ConflictUnemployment fell to 4.9% in the three months to February, down from 5.2% in the previous quarter. While the headline suggests improvement, economists warn that the decline masks rising economic inactivity and a continued fall in pay‑rolled jobs, which were down 65,000 year‑on‑year in March.Numbers Reveal Slowing Job Creation and Wage StagnationUnemployment rate: 4.9% (Feb) vs 5.2% (previous quarter)Pay‑rolled jobs: –65,000 YoY (Mar)Total pay growth (3‑month to Feb): 3.8%, weakest since autumn 2020Private‑sector regular pay growth: 3.2%Real pay growth after inflation: 0.7%, lowest since mid‑2023Sanjay Raja, chief UK economist at Deutsche Bank, cautioned that “signs of weakness continue” beneath the headline figures. Peter Dixon of the National Institute of Economic and Social Research echoed concerns about limited wage‑price dynamics.Implications for Inflation, Consumer Spending, and Upcoming ElectionsWeak wage growth reduces the risk of a “second‑round” wage‑price spiral, potentially easing pressure on the Bank of England’s Monetary Policy Committee. However, stagnant real wages heighten the cost‑of‑living squeeze for households, a factor that could influence voter sentiment in the imminent Scottish, Welsh and English local elections and increase scrutiny on Rachel Reeves to mitigate energy‑price impacts.Outlook: BoE Policy and Labour Market Through 2026Analysts expect the BoE to keep the policy rate at 3.75% for the near term, with at most one modest hike later in the year, as the labour market lacks the momentum to justify aggressive tightening. Forecasts also suggest unemployment may rise through 2026 as the Iran war’s economic fallout curtails growth.

The conflict in the Middle East is expected to have a significant impact on the UK's economy, with the Organisation for Economic Cooperation and Development (OECD) warning of rising inflation and downgrading the UK's growth forecast to 0.7% this year.The OECD's analysis suggests that the UK economy will grow by just 0.7% this year, compared to its last forecast of 1.2% for 2026. This downgrade is attributed to a weakening of the UK jobs market and a contraction in business investment towards the end of 2025.The UK's economy is expected to suffer higher inflation than previously expected, with the OECD citing the country's dependence on international trade and imports of fuel as a major factor. In contrast, France, Germany, and Italy are expected to suffer a more modest hit to growth of 0.2 percentage points.The OECD's chief economist noted that the evolving conflict in the Middle East will test the resilience of the global economy, which is expected to grow at an average rate of 2.9% this year. However, the organization warned of a significant downside risk to the outlook, citing persistent disruptions to exports from the Middle East and potential repricing in financial markets.UK Chancellor Rachel Reeves responded to the OECD's warning, stating that the government plans to take steps to build a stronger, more secure economy, including handing more powers to regional mayors, embracing AI and innovation, and establishing a closer relationship with the EU.