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M&S CEO Warns of Rising Costs, but Vows to Protect Customers from Price Hikes

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Marks & Spencer (M&S) CEO Stuart Machin has acknowledged the company is facing significant cost pressures following recent tax changes, but emphasized that the retailer will “do everything we can” to avoid passing these increased costs onto customers.

M&S expects its tax bill to rise by £60 million next year, bringing its total liability to approximately £520 million. This increase is attributed to the Chancellor’s decision to raise employers’ National Insurance (NI) contributions by 1.2 percentage points to 15% from next April, as well as lowering the threshold at which companies begin paying the contribution.

Machin noted that M&S had anticipated some increase in costs following budget announcements but was caught off guard by what he called a “double whammy” of tax changes. In addition to the NI rise, the retailer expects another £60 million increase in labour costs due to higher minimum wage rates, a cost that had already been factored into its planning.

Despite these increases, Machin reiterated that M&S is committed to keeping prices stable, saying, “We’re going to work incredibly hard to mitigate costs elsewhere and avoid raising prices.” He pointed to the company’s “good track record” of finding savings and efficiency improvements as key to managing rising expenses without burdening customers.

The warning from M&S comes amid broader concerns within the retail sector about escalating costs. Analysts suggest that the National Insurance changes alone could add between £550 million and £600 million to the costs of UK grocers. Primark’s parent company has also indicated it may implement measures, such as introducing self-checkouts, to reduce its labour costs in response to similar pressures.

The Budget has sparked discontent across the business community, with a recent survey by the Institute of Directors revealing that two-thirds of business leaders feel negatively about the new policies. Additionally, many of these leaders believe that Chancellor Rachel Reeves’s measures fail to support long-term economic growth.

However, Machin’s cautious outlook coincided with a positive financial performance for M&S. The company reported a 17% increase in profit before tax and adjusting items to £408 million for the six months ending 30 September, surpassing analysts’ expectations of £360 million. The retailer’s shares surged by as much as 7.4% on Wednesday following the announcement.

The strong results highlight the success of Machin’s turnaround strategy for M&S, with both the food and clothing divisions showing growth. Looking ahead to the Christmas season, Machin expressed optimism, citing research indicating that customers are planning to spend more this year than they did in 2023.

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Amazon MGM Takes Creative Reins of James Bond Franchise Amid Casting Buzz

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In a landmark shift for the James Bond franchise, Amazon MGM has partnered with long-time producers Michael G. Wilson and Barbara Broccoli to oversee the future of 007. While all three entities retain co-ownership of the Bond intellectual property, Amazon MGM will now lead creative decisions, marking a significant departure from its previously limited role.

The move follows Amazon’s $8.5 billion acquisition of MGM in 2021, which granted it partial ownership but little say in the franchise’s artistic direction. With Daniel Craig’s departure after 2021’s No Time to Die, speculation about the next James Bond has intensified. Jeff Bezos, Amazon’s founder and executive chairman, fueled the debate by asking his followers on social media platform X, “Who’d you pick as the next Bond?” The overwhelming response highlighted British actor Henry Cavill as a fan favorite. Known for roles in Superman, The Witcher, and Mission: Impossible – Fallout, Cavill previously auditioned for the role in 2006’s Casino Royale but lost to Daniel Craig. Director Martin Campbell praised Cavill’s audition but deemed him too young at the time. Now in his early forties, Cavill’s age could be a factor if long-term commitments are considered.

Daniel Craig acknowledged Wilson and Broccoli’s contributions, telling Variety, “My respect, admiration, and love for Barbara and Michael remain constant and undiminished.” With Wilson stepping back and Broccoli expected to reduce her involvement, Amazon MGM gains greater creative control, raising questions about the franchise’s future direction.

Fan speculation continues to swirl around Cavill, alongside other contenders like Taron Egerton, Tom Hardy, and Idris Elba. While Amazon MGM has yet to announce a timeline or reveal casting decisions, industry watchers anticipate a new era that may extend beyond traditional films, potentially including spin-offs, series, and streaming exclusives. As the studio reshapes Bond’s future, audiences worldwide eagerly await the next chapter in the iconic spy saga.

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Global Hiring Slump Marks Longest Downturn in Decades, Says Hays CEO

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The global job market is experiencing its longest downturn in over 20 years, according to Dirk Hahn, CEO of Hays, Britain’s largest listed recruitment firm. Hahn attributes the slump to ongoing macroeconomic uncertainty, which is deterring both employers and job seekers from making moves.

Hays, which employs nearly 7,000 consultants worldwide, reported weaker demand for temporary workers in early 2025, while demand for permanent roles—particularly in Europe—remains sluggish following a pre-Christmas dip. Countries such as France, the UK, Ireland, and Germany, Hays’s largest market, are feeling the pressure most acutely.

In the six months leading up to December, Hays reported a 15% drop in group net fees, falling to £496 million from £583.3 million the previous year. Pre-tax profits fell sharply by 67% to £9.1 million, compared to £27.6 million during the same period the prior year. Hays’s share price, already down 25% over the past year, dipped a further 1.8% on Thursday, closing at 71¾p and placing the company’s market value just below £1.2 billion. Despite declining profits, the company will maintain its interim dividend at 0.95p per share.

While the broader UK labor market has shown resilience with limited mass layoffs, businesses remain cautious about expanding their workforce. “Most companies have enough work to retain their current staff, but they’re not looking to increase headcount,” said James Hilton, Hays’s chief financial officer. “Many employees who received pay increases in recent years are not seeking new roles, creating a stalemate. However, over time, people will seek promotions or fresh challenges.”

Recruiters had anticipated a market recovery earlier this year, but Hahn now warns that the rebound may not materialize until 2026. In the meantime, Hays is focusing on its technology recruitment division—its most profitable segment—as it navigates the prolonged global hiring slowdown.

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UK Government Reports Lower-Than-Expected Budget Surplus in January

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The UK government reported a budget surplus of £15.4 billion in January, falling short of economists’ forecasts of £21 billion and the £19 billion predicted by the Office for Budget Responsibility (OBR). Despite January typically seeing a boost from self-assessment tax payments, the lower-than-expected figure has increased total borrowing for the financial year to £118.2 billion—over £11 billion more than the previous year.

The government’s debt-to-GDP ratio now stands at 95.3 per cent, a level last observed in the 1960s. With the OBR set to release updated forecasts on March 26, there are concerns that the government may struggle to meet its goal of reducing the debt ratio by 2029. This could lead to potential spending cuts or tax hikes in the autumn budget.

Reduced debt-servicing costs helped boost January’s surplus, dropping from £9 billion in December to £6.5 billion. However, this was partially offset by a £6 billion one-off expense related to the government’s repurchase of military housing from private firm Annington.

Darren Jones, chief secretary to the Treasury, emphasized the government’s commitment to “economic stability and meeting our non-negotiable fiscal rules.” He also noted that a comprehensive spending review—the first of its kind in 17 years—is underway to ensure that public funds are used efficiently and aligned with national priorities.

 

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