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Chancellor Rishi Sunak is "cautiously optimistic" about the state of the UK jobs market

   News / 03 Nov 2021

Published: 03 November 2021
Location: London, UK

By Suzanne Evans, Director, Political Insight


Chancellor Rishi Sunak told the Economic Affairs Committee yesterday that he is "cautiously optimistic" about the state of the UK jobs market because informal surveying by the Treasury had returned anecdotally positive results and that job retention numbers so far remained fairly high.  There were around 1 million people on the tapered furlough scheme by the time it wound down at the end of September and there has not been an uptick in redundancy notices, he said. The chancellor also noted record numbers of job vacancies and healthy ratios of unemployed people to those vacancies. Yahoo Finance UKalso reports that the Chancellor told the committee he had not seriously considered altering the remuneration of bank reserves at the Bank of England, following warnings from Richard Hughes, head of the Office for Budget Responsibility, who told the Treasury Committee on Monday that "the headroom he set aside to reach those targets is the second-lowest headroom that any chancellor has had when setting fiscal rules."
 
Chancellor Rishi Sunak is to outline plans for the UK to become the world's first net zero-aligned financial centre, partly by forcing financial institutions to align themselves with the Paris Agreement 1.5C warming limit and set out how they will transition to net zero by 2023, and by launching a new financing mechanism — the Climate Investment Funds’ Capital Markets Mechanism(CCMM) — to  boost investment into clean energy like solar and wind power in developing countries. This new fund will issue green bonds that could leverage an extra $30-70bn for clean energy projects. The Treasury also said the UK will usher in climate commitments from private companies covering $130tn of financial assets on Wednesday's Finance Day at COP26. These are worth about 40% of the world's total financial assets.
 
Four more energy companies have gone out of business as the surge in wholesale gas suppliers continues to take its toll. Omni Energy, MA Energy, Zebra Power and Ampoweruk all said they were ceasing to trade yesterday. Regulator Ofgem said it will choose suppliers to take on around 21,000 domestic customers affected by the collapses. This is the latest in a string of supplier failures over the last two months, the Telegraph says. The number of UK households whose energy provider has ceased trading this year now stands at 2 million as surging gas costs have priced smaller vendors out of the industry. More than 16 energy companies have gone bust since August.
 
The UK needs another 40,000 heating engineers to help decarbonise the country’s homes and install enough heat pumps, the boss of Centrica has said. Chris O’Shea said the company, which owns British Gas, is hiring the equivalent of one new apprentice every day this decade as it tries to retrofit millions of homes across the country. He told a COP26 fringe event that Centrica is aiming to install up to 20,000 heat pumps every year by the middle of the decade. He also cautioned against thinking the cost of heat pumps would come down just because the government is now pushing their use, saying France has been using heat pumps for years, but prices are still high. “Heat pumps are expensive but they are a critical part of what we need to do,” he said.
 
Global oil demand has bounced back above the key level of 100 million barrels a day last seen before the Covid-19 pandemic, according to BP Plc.“Somewhere next year we will above pre-Covid levels,” BP Chief Financial Officer Murray Auchincloss said on a conference call on Tuesday.
 
Consumers will be threatened with even higher energy prices if the Government backs a "premature" ban on oil and gas drilling in the North Sea, the chief executive of BP has warned. Bernard Looney said Ministers will simply increase Britain's reliance on imports if they bow to pressure from activists and block all new fossil fuel projects, with no impact on carbon emissions.  "If you take away supply but demand does not change, the only thing that happens is prices go up,” he said, "so we need to be very careful about prematurely taking away supply from the market". The oil and gas industry is waiting to see if approval will be granted for drilling at the Cambo oil field in the North Atlantic, thought to contain more than 800 million barrels of crude, with a decision expected before the end of the year. Climate groups claim the scheme risks undermining Mr Johnson’s promise to lead the charge in cutting carbon emissions globally. BP recently faced its own controversy over plans to extract oil from the Vorlich field, in the North Sea, although it successfully fought off a legal challenge against the scheme from Greenpeace.Looney said BP is still trying to convince experts that it can be part of the green energy transition, following complaints by the boss of Shell that his company was told it was not welcome at Cop26.
 
A row broke out yesterday over the labelling of a Morrison’s chicken as British but containing ‘non-EU salt and pepper.” The label provoked an angry reaction on Twitter and the supermarket chain was accused of stoking "anti-EU hatred". Morrison’s apologised and said it would change the packaging “immediately" to make the non-EU element less prominent, adding that the words would still have to be included somewhere on the wrapping because of packaging laws. According to government guidance on food labelling, the term "non-EU" must be used on meat packaging when full country information is unavailable. From October next year, following post-Brexit rule changes, this will be replaced by "non-UK".
 
Liberty Steel has resumed production at its Rotherham plant - closed since the spring - following a £50 million cash injection. The investment, part of a wider restructuring of Liberty's owner GFG Alliance's operations, safeguards 660 jobs at the Yorkshire site.
 
BT Group and OneWeb have inked a new distribution partnership agreement to provide the latter's Low Earth Orbit satellite communication services. Testing was already ongoing to integrate OneWeb's LEO satellite technology with BT's existing terrestrial capabilities and, if successful, live trials with customers were set to begin from early 2022. Digital Secretary Nadine Dorries said: "The agreement between OneWeb and BT will help bring fast and reliable global connectivity, from the Highlands to the Himalayas.” Satellite services were a component of BT's vision to enable digital solutions anywhere in the UK by 2028 and the agreement would also support the government's National Space Strategy, the company said.
 
The Confederation of British Industry survey of 249 SME manufacturerssuggests almost two-thirds are concerned that the supply of materials and components could impact their output in the next three months, the highest share on record since 1988. Worries about the availability of skilled labour(46%) were also higher than at any other time in the survey data’s 33-year history.
 
A shortage of a chemical called ethoxydiglycol is causing problems for the cosmetics manufacturing industry, Yahoo Finance UK reports. Ethoxydiglycol, which is soluble in both oil and water, is vital in products such as fake tan and shampoo. It is also used in many eczema creams. The shortage, which is expected to hit UK and European cosmetics manufacturing in the next few weeks, has already seen a near ten-fold price hike. Prices have increased from £12.10 to £103 per kg in recent weeks. Minimum order quantities set by many suppliers have also increased from 24kg to 1,000kg, meaning the minimum order is now £103,000, which will halt production for many smaller businesses who cannot afford to purchase in those quantities. Many suppliers are now completely out of stock.
 
It has been revealed that Jes Staley, the Barclays bank CEO who quit on Monday in the wake of an investigation into his links with paedophile financier Jeffrey Epstein, is in line for bonus payouts in the form of 11.4 million shares worth up to £22m if the bank hits targets in coming years, according to its annual report.
 
Baseimmune, an Imperial College biotech startup that has set itself the goal of creating the “next generation of future-proof universal vaccines” against health threats including COVID, malaria and African Swine Fever, has raised $4.8m (£3.5m). The investment round, led by Hoxton Ventures, will enable the company to develop more vaccines and expand the number of diseases it is able to tackle. “Through Covid, we’ve all learned the importance of having effective and rapidly developed vaccines. With its unique software platform, Baseimmune is setting the bar by leveraging AI to innovate vaccine therapies.” said Hussein Kanji, partner at Hoxton Venture. The company said the pandemic has started a "renaissance in vaccine research" that is underpinned by the creation of novel vaccine delivery systems and robust worldwide manufacturing pipelines, adding that the global vaccine market is predicted to reach $108bn by 2027.
 
The Daily Mail and General Trust (DMGT) edged closer to going private on Tuesday, after it confirmed it was near to agreeing terms with its three pension schemes. The owner of the Daily Mail and i newspapers first announced in July that Rothermere Continuation (RCL), which owns around 30% of the listed firm, had indicated it was prepared to make a cash offer of 251p per share, implying an enterprise value of around £810m, subject to three pre-conditions. Two have since been met: DMGT's insurance risk division RMS was sold to Moody's Corporation for £1.4bn, and online car seller Cazoo was successfully listed, with DMGT's stake distributed to shareholders. The remaining pre-condition concerned the media group's pension schemes, and yesterday DMGT said it and RCL were "close to agreeing" a deal with the trustees, which would see it pay around £400m into the three schemes. Should the trustees agree, RCL will then be clear to table its offer. Following an extension granted last month by the Takeover Panel, RCL has until 25 November to either make an offer or walk away. Jersey-registered RCL is the holding company of DMGT's executive chair Jonathan Harmsworth, the viscount Rothermere, who inherited his role on the board and position as controlling shareholder following the death of his father in 1998. Lord Rothermere controls all of the issued voting shares, which means any deal he backs and is recommended to shareholders will be approved.
 
GlaxoSmithKline has dismissed a Mail on Sunday report that said the British pharma group could be interested in bidding for autoimmune disease drug developer Aurinia Pharmaceuticals Inc. “The report is not true”, a GSK spokesperson said in an email.
 
FTSE 100 drinks giant Diageo has signed a deal to build its first malt whiskydistillery in China, where demand for the spirit is growing rapidly. The $75m Diageo Eryuan distillery will be in Eryuan County, Yunnan province, and will produce the company's first single malt of Chinese origin. The maker of Johnnie Walker and Talisker whiskies said the 66,000 sqm facility would be more than 2,100m above sea level and that the site was selected for its temperate climate, biodiversity and access to natural spring water. The distillery will be carbon neutral, zero waste and recycle all its water. Construction is scheduled to start in early 2022.
 
US tech giant Yahoo has pulled out of China, citing the country's "increasingly challenging" business and legal environment. "Yahoo remains committed to the rights of our users and a free and open internet. We thank our users for their support" a statement said. Yahoo, which has operated in China since 1998, has been reducing operations in the country for some time.  As of last week, it had just a weather app and some pages showing news articles in foreign languages, Reuters reported. Its Beijing office was shuttered in 2015, and its music and email service stopped in the early 2010s. Yahoo's decision echoes a similar move by fellow US tech firm Microsoft, which last month shut down its networking platform LinkedIn in China, citing "a more challenging operating environment and greater compliance in requirements". Beijing is looking to curb the powers of internet companies and has introduced new laws ranging from content to privacy. Yahoo was sold by Verizon Communications to private equity firm Apollo Global Management for $5bn in May.
 
Facebook has announced it will no longer use facial recognition software to identify faces in photographs and videos, following controversy over the technology, with questions raised over privacy, racial bias, and accuracy. Until now, users of the social media app could choose to opt in to the feature which would scan their face in pictures and notify them if someone else on the platform had posted a picture of them.
 
Amazon drivers are being given $60m (£44m) in tips that were illegally withheld by the online retailer, America's consumer watchdog has said. Sky News reports more than 140,000 drivers are receiving an average of $422 (£310) each while the highest amount going to a single person is more than $28,000 (£20,560). It comes after the Federal Trade Commission (FTC) sued Amazon and its subsidiary Amazon Logistics, claiming that it failed to pay tips in full that drivers in its Amazon Flex operation had earned.


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