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UK Business Investment Rises 3% Over the Past Year

Rachael Caffrey , 

The latest research from The Global Payroll Alliance (GPA) reveals that investment into UK business has increased by 3% in the past year, driven by large boosts to the likes of clothing manufacturing, electricity production, and agriculture.

investment

Production Sector Leads Growth with 24.6% Surge

GPA’s analysis of ONS business investment data* shows that between 2023 and 2024 (latest available data), total investment into UK businesses increased by 3%.
The production sector saw the biggest increase, with investment rising by 24.6% on the year. This was driven by a strong performance from all three production subsectors:

  • Electricity, Water & Gas production: +31.9%

  • Agriculture, Forestry & Fishing: +20.9%

  • Mining & Quarrying: +11%

Steady Gains in Distribution and Construction

The UK’s Distribution and Construction sectors also benefited from annual investment increases, rising by 4% and 3.1% respectively.

Mixed Performance in Manufacturing Sector

While investment into the overall Manufacturing sector remained flat (0.0%), several key subsectors saw notable growth:

  • Textiles, Clothing, Leather & Footwear: +81.2%

  • Food, Drink & Tobacco: +10.1%

  • Engineering & Vehicles: +2.2%

Selective Growth in Services Sector Despite Overall Decline

Investment into the overall ‘Other Services’ sector fell by -1.3%, but some subsectors bucked the trend:

  • Transportation & Storage: +12.3%

  • Hotels & Restaurants: +8.6%

  • Information & Communication: +2.8%

Melanie Pizzey, CEO and Founder of the Global Payroll Alliance, says:

“Since the Labour government’s Autumn Statement, concerns about job losses have been rife among UK employees, highlighted by a 77% increase in online searches for ‘redundancy rights’ since October 2024.

However, the increased investment into UK businesses – especially production, distribution, and construction – should result in the creation of many new jobs over the coming years. We just have to hope that the financial boost businesses are seeing results in a concerted effort to boost productivity  and therefore employment. There remains a risk of instability in the UK economy due to the government’s seeming inability to settle firmly on a plan for growth, but we remain quietly optimistic that the increase of money moving into businesses will result in an increase of money moving into people’s pockets.”

Data tables and sources