Closing post
Time to wrap up:
The UK construction sector last month suffered its sharpest slowdown in activity since the first Covid lockdown as building projects were scaled back and jobs cut amid budget uncertainty, according to a closely watched survey.
In a blow to Labour’s aims to boost infrastructure projects and build 1.5m homes by 2030, the poll of UK construction firms showed output in November shrinking at the fastest pace since May 2020, when all building stalled as the pandemic shut down sites.
The monthly purchasing managers’ index (PMI) for construction, considered one of the best indicators of growth in the sector, fell to 39.4 in November, down from 44.1 in October and below the 44.6 forecast by economists. Any reading above 50 represents growth and anything below a contraction.
Budget uncertainty has also been blamed for UK investors cutting their investments in equity funds in November…
…and for a slowdown in sales growth of electric cars.
Shares in Trustpilot fell by over a quarter today after Grizzly Research disclosed a short position and accused the global review platform of creating fake profiles that gave negative reviews and then pressuring companies to pay for subscriptions. Trustpilot has denied the claims.
Households face higher energy bills after network companies were given the green light to spend £28bn on Great Britain’s gas and electricity grids.
The energy watchdog, Ofgem, approved more than £17.8bn of spending plans to upgrade gas transmission and distribution networks in the five years from April 2026.
A further £10.3bn will be used to rewire the nation’s high-voltage electricity network – the biggest expansion of the grid since the 1960s.
Trustpilot’s attempt to rebut (see here) Grizzly Research’s accusations (see here) haven’t revived its share price.
Trustpilot’s stock is now down almost 28% today, the biggest faller among the 350 largest companies listed in London.
Updated
Back in the UK, new data confirms that people pulled cash out of investment funds in October, in the run-up to November’s budget.
In October, equity funds saw £5bn of outflows, with all major regions in withdrawal.
Kate Marshall, lead investment analyst at Hargreaves Lansdown, has the details:
“UK retail investors pulled a net £4.5 billion from funds in October, according to the latest Investment Association data. This marks the weakest month since October 2024 and reflects a clear rise in caution as speculation around the Autumn Budget intensified.
Equity funds saw the largest impact, with £5.0 billion withdrawn across all major regions. Global equities suffered the heaviest redemptions at £2.5 billion, while UK equity outflows accelerated to £1.4 billion. Sentiment also turned in North America, where concerns over stretched valuations in US mega-cap technology stocks and fears of an ‘AI bubble’ contributed to £649 million in withdrawals. Technology-focused funds recorded their biggest-ever monthly outflow of £322 million.
Flows into bond funds were broadly flat at -£2 million. Investors favoured Strategic Bond, Corporate Bond and Global Emerging Markets Local Currency funds, but this was outweighed by selling in developed-market government bonds. UK Gilt and Government Bond sectors saw a combined £548 million in outflows partly due to uncertainty about the trajectory of Bank of England rate cuts.
Mixed asset funds experienced their first outflows in a year, with £51 million withdrawn. Money market funds, which have been in demand throughout much of 2025, were broadly stable with marginal inflows of £1 million. Tracker funds also saw muted appetite, recording modest inflows of £306 million.
Bloomberg: Meta’s Zuckerberg Plans Deep Cuts for Metaverse Efforts
Mark Zuckerberg is expected to “meaningfully cut resources” for building the metaverse, Bloomberg are reporting.
They say Meta executives have discussed potential budget cuts as high as 30% for the metaverse group next year, which includes the virtual worlds product Meta Horizon Worlds and its Quest virtual reality unit.
Cuts that high could most likely include layoffs as early as January, and would be a policy u-turn for Zuckerberg, who had once seen virtual reality as the future of Meta.
Back in 2021, Zuckerberg renamed Facebook’s holding company to Meta, declaring “We believe the metaverse will be the successor of the mobile internet.”
Since then, though, artificial intelligence has emerged as The Big Thing in technology…
US initial jobless claims hits three-year low
Just in: The number of Americans filing new claims for jobless support has hit a three year low.
There were 191,00 new ‘initial claims’ for unemployment benefits last week, a drop of 27,000 compared with the previous week.
That’s the lowest level for initial claims since September 24, 2022. It could take some pressure off the US Federal Reserve to cut interest rates as quickly as the markets have been hoping…
Breaking down initial jobless claims NSA by region: pic.twitter.com/JGdpUwx3N6
— Michael McDonough (@M_McDonough) December 4, 2025
Trustpilot rejects "misleading short seller claims"
Newsflash: consumer reviews site Trustpilot says it rejects the allegations made by short seller Grizzly Research today.
In a statement to the stock market, Trustpilot responds:
The Report presents a series of claims that are selective, misleading and framed to support a predetermined narrative. It omits key context and publicly available facts, creating a false impression and exhibits a lack of understanding of how Trustpilot works. Trust is our guiding principle and is central to everything we do.
As covered in our earlier post, Grizzly has taken a short positon on Trustpilot’s shares, and claims the company is operating an ‘extortion racket,’ attracting negative reviews and then charging companies for the ability to remove them.
Updated
US firm keep cutting jobs too
Over in the US, companies have been cutting jobs too.
U.S.-based employers announced 71,321 job cuts in November, up 24% from the 57,727 job cuts announced in the same month last year, outplacement and coaching firm Challenger, Gray & Christmas has reported.
November’s total is the highest for the month since 2022. But it’s 53% fewer cuts than in October, when 153,074 cuts were announced.
Andy Challenger, workplace expert and chief revenue officer for Challenger, Gray & Christmas, says:
“Layoff plans fell last month, certainly a positive sign. That said, job cuts in November have risen above 70,000 only twice since 2008: in 2022 and in 2008.”
So far this year, US employers have announced 1,170,821 job cuts, an increase of 54% from the 761,358 announced in the first eleven months of last year. Year-to-date job cuts are at the highest level since 2020.
£28bn energy network upgrade plan criticised
Greg Jackson, founder and CEO of Octopus Energy, is calling for close scrutiny of the £28bn energy spending plans signed off by Ofgem this morning.
Jackson suggests billions of pounds could be shaved off the infrastructure upgrade plans, saying:
“Of course we need new infrastructure but these plans risk pushing bills ever higher. Every bit of these plans needs examining carefully and serious challenge to see what can be saved. Cheaper batteries and more flexibility could cut bills by billions, as could modern grid technologies and more competition.”
As explained in the introduction, Ofgem has given the green light to £17.8bn of investment in Britain’s gas networks, and £10.3bn in new electricity infrastructure, by 2013, pushing up customers’ bills.
Green industrialist and founder of Ecotricity, Dale Vince OBE, has criticised the plan:
“Ofgem are wrong to claim that increasing renewable energy on the grid, which these bill hikes will support - will in turn lower bills and or insulate us from volatile gas prices.
Because, unless we ‘break the link’ we will remain attached to volatile global gas prices and we will continue to allow the global gas price to set the price of our own green energy. If we don’t break the link we remain linked to global gas pricing. And our entire economy continues to suffer the impact of artificially high energy bills.”
UK firms reduce headcounts, with more job cuts expected
More gloom: UK businesses cut jobs at the fastest pace in four years last month.
A survey of chief financial officers at UK companies, conducted by the Bank of England, has found that firms cut employment levels by an annual rate of 1.8% in November.
That’s the biggest monthly drop since July 2021.
Firms expect to keep cutting their headcounts; expectations for employment growth over the next year fell to -0.7% in November, the gloomiest outlook since October 2020.
Trustpilot shares plunge after being accused of “mafia-style extortion campaigns”
In the City, shares in third-party review site Trustpilot have plunged by almost a quarter after being accused of operating “mafia-style extortion campaigns” to boost its business.
Grizzly Research, a short seller, has issued a report in which it accuses Trustpilot of creating unsolicited review profiles for all kinds of businesses with the intention to attract hyper-negative reviews.
This then prompts the businesses into paying subscription deals to “more actively manage” the reviews, Grizzly claims. While Trustpilot uses a freemium business model (consumers can read and write reviews for free), businesses can opt for paid subscription plans that include review-management features.
Grizzly, who say they are short on Trustpilot’s stock (betting that it will fall) have accused Trustpilot of creating a platform to attract bad reviews, meaning customers must pay to dilute the bad reviews.
In their report (online here) Grizzly say:
Reviewers find their genuine negative reviews spuriously challenged or removed for companies that pay Trustpilot. On the other hand, we found countless obviously fake positive reviews and reviewers for paying companies. Trustpilot is either doing a very bad job at policing their website or is willfully negligent when convenient.
We are short Trustpilot Group PLC $TRST.L
— Grizzly Research (@ResearchGrizzly) December 4, 2025
Our new report is titled: The “Trustpilot Mafia” – How the Extortion Model Destroys Trustpilot’s Value Proposition
You can read the report here: https://t.co/NAYioU0XLY
Shares in Trustpilot are down 23.7% as investors digest Grizzly’s claim that they have “gone all in” on becoming an “extortion racket” – a move which will make Grizzly’s short position profitable….
2pm UPDATE: Trustpilot have responded, saying Grizzly’s claims are “selective, misleading and framed to support a predetermined narrative”. See this post for more.
Updated
Ireland's GDP falls by 0.3% in Q3
Ireland’s economy shrank by more than first estimated in the July-September quarter, new data shows.
Irish GDP contracted by 0.3% in the third quarter of 2025, the Central Statistics Office reports, worse than the 0.1% contraction initially estimated.
However, the decline was mainly due to lower output at multinationals based in Ireland.
The domestic economy did better; Modified Domestic Demand (MDD), which measures domestic personal, government, and investment spending, grew by 2.3% in Q3 2025.
Assistant director general with responsibility for National Accounts & Price Statistics, Chris Sibley, says:
The globalised Industry sector contracted by 0.7% in Q3 2025 when compared with Q2 2025 while the Information & Communication sector posted an increase of 0.6% over the same period. Overall, the multinational-dominated sector rose by 0.2% in the quarter.
There was a mixed picture for the domestic economy in Q3 2025. Modified Domestic Demand (MDD) grew by 2.3% in the quarter reflecting higher levels of investment spending. However, personal spending increased by a more modest 0.1% while real wages fell by 0.1% over the same period.”
FCA asks for details of Budget leak inquiry
Newsflash: The UK’s financial watchdog has asked to see details of the government’s leak inquiry into the budget.
The Financial Conduct Authority (FCA) has written to the Treasury Select Committee to explain how it is responding to the flurry of speculation and news articles ahead of last month’s Budget.
In the letter, the FCA says three main concerns or allegations which may have caused movements in markets have been raised with it:
That briefings by Ministers and Government officials were misleading and may have amounted to market manipulation.
Inappropriate placing of market sensitive or inside information into the public domain through Government briefings or leaks.
The early release of the Office for Budget Responsibility’s (OBR) Economic and Fiscal Outlook.
The FCA says it has requested details of the leak inquiry which was announced yesterday in parliament.
However, it has not commenced an enforcement investigation.
It says:
We have requested details of this work and that the outcome, including of the inquiry into any leak of market sensitive or inside information relating to the Budget, is shared with us so we can consider as appropriate.
The FCA is also considering the investigation into the early release of the Office for Budget Responsibility’s Economic and Fiscal Outlook, adding:
We are now considering this report and welcome the statement in the report’s conclusion that “we are confident that that the OBR will cooperate fully with the FCA”.
UK construction slump: what the experts say
Rob Wood, chief UK economist at Pantheon Macroeconomics, has described today’s construction PMI report as “catastrophic”, although it may exaggerate the extent of the downturn.
It’s hard to believe that conditions are as bad as during a full lockdown, but risks clearly lie towards further output falls, he says.
Wood says:
To say construction firms were unhappy with Budget speculation would be an understatement. The PMI points to catastrophic conditions in the construction sector, with the activity balance showing the sharpest output fall since the country was in Lockdown in May 2020.
We estimate that the PMI is consistent with output in the construction sector falling by 2.6% three-months-on-three-months, sharply worse than the 1.5% fall signalled by the October PMI. But we find it hard to believe that conditions in the sector are genuinely as bad as during a full lockdown.
The ONS official measure of construction output has been faring far better than the PMI signal, as our chart below shows. There’s no doubt that construction firms are extremely disappointed in the government’s progress, but we think the PMI remains too pessimistic.
Huda As’ad, Accenture’s Capital Projects and Infrastructure lead in the UK and Ireland, says the UK construction sector is fragile:
“Construction activity has fallen to its lowest point in over five years, highlighting the sector’s ongoing fragility. While the Budget reaffirmed commitments to housing, infrastructure funding and clean-energy deployment, these longer-term measures have yet to offset the immediate pressures facing firms.
Skills shortages continue to weigh on key trades, and construction firms see government investment in training and apprenticeships as vital to restoring confidence across the sector. To avoid further slowdown, the industry must increase productivity, strengthen supply chains, and embrace digital and modern construction methods.
Firms that prioritise technology will come out on top in the long run, clearing delivery bottlenecks and preparing for the next wave of infrastructure and clean-energy investment. As we head into 2026, the next few months will be critical in determining whether the sector can turn the tide.”
Updated
Worryingly, business optimism in the UK construction sector is the weakest since December 2022, today’s PMI report shows.
S&P Global says:
Looking ahead, the proportion of construction companies expecting an upturn in business activity in the next 12 months (31%) narrowly exceeded those forecasting a decline (25%).
The resulting Future Activity Index signalled the lowest degree of optimism since December 2022. Some firms commented on hopes of a rebound in general market conditions and support from lower borrowing costs. However, this was offset by signs of cutbacks to clients’ investment spending plans and concerns about long-term domestic economic prospects.
The decline in housebuilding, civil engineering and commmercial construction work in recent months is quite startling, as this chart shows:
November sees UK construction output fall at the steepest rate for five-and-a-half years. None of the construction sectors were immune to budget fears and economic uncertainty; leaving many a new order on the shelf. As a consequence from the lack of demand; supplier staffing… pic.twitter.com/b3qW2ZKfeA
— Emma Fildes (@emmafildes) December 4, 2025
Budget uncertainty plunges building sector into worst slump since May 2020
Newsflash: Britain’s construction sector has suffered its sharpest downturn since the first Covid-19 lockdown forced building sites to shut five and a half years ago.
Activity across housebuilding, commercial building work and civil engineering all tumbled last month, a new survey of puchasing managers at building firms has found.
Construction firms are blaming fragile market confidence, delays with the release of new projects and a lack of incoming new work.
The report, by data firm S&P Global, shows there was “a sharp and accelerated reduction in output levels across the construction sector”. Many builders reporting that market conditions were challenging, with new orders slumping at the fastest rate in five and a half years, and job cuts rising.
Many construction companies commented on weak client confidence, alongside delayed spending decisions linked to uncertainty ahead of the Budget, S&P Global says.
This dragged the UK construction PMI down to 39.4 in November, down from 44.1 in October, the lowest since May 2020. Any reading below 50 shows a contraction.
Lower volumes of construction output have now been recorded for eleven months in a row, S&P Global reports.
Sub-sector data showed that housing activity (index at 35.4), commercial construction (43.8) and civil engineering (30.0) all experienced the fastest downturns in activity for five-and-a half years.
Tim Moore, economics director at S&P Global Market Intelligence, said:
“November data revealed a sharp retrenchment across the UK construction sector as weak client confidence and a shortfall of new project starts again weighed on activity.
Total industry activity decreased to the greatest extent for five-and-a-half years, led by steep falls in infrastructure and residential building work. Commercial construction also faced severe headwinds during November as business uncertainty in the run up to the Budget pushed clients to defer investment decisions. “Lower workloads, alongside pressure on margins from rising wages and purchasing costs, continued to dampen staff hiring in November. The latest round of job cuts was the most marked since August 2020.”
“Construction companies also signalled a slide in business activity expectations for the year ahead as hopes of an imminent rebound in sales pipelines faded in November. The degree of optimism dropped to its lowest since December 2022 amid reports of cutbacks to client budgets and pervasive worries about long-term UK economic growth prospects.”
Updated
Key event
Budget leaks may also have hit demand for electric cars last month.
The UK new car market declined slightly in November with new registrations falling by -1.6% to 151,154 units, the Society of Motor Manufacturers and Traders (SMMT) has reported.
The falll was driven by a -5.5% drop in purchases by private buyers, while sales to business customers rose.
Sales growth in battery electric vehicles slowed to its lowest rate in almost two years - up 3.6%. This lifted the BEV market share to 26.4%, up from 25.1% a year ago.
In early November, it was reported that electric vehicle (EV) drivers would be hit with a new tax in the budget, and be charged 3p per mile on top of other road taxes, as Reeves indeed announced on 26 November.
The SMMT fears that these plans for a “pence per mile” electric Vehicle Excise Duty (eVED) will endanger the UK’s net zero transition.
Mike Hawes, SMMT chief executive, says:
Even in a fragile market, zero emission vehicle uptake continues to rise, which is exactly what we need. But the weakest growth for almost two years – ahead of government announcing a new tax on EVs – should be seen as a wake-up call that sustained increase in demand for EVs cannot be taken for granted.
We should be taking every opportunity to encourage drivers to make the switch, not punishing them for doing so, else the ambitions of government and industry will be thwarted.
Budget leaks 'create havoc' as UK investors pull out of funds
Uncertainty over the contents of last month’s budget has been blamed for a record-breaking selling spree of equities by UK investors.
Data provider Calastone has reported that “the most prolonged and most severe bout of equity fund outflows continued unabated” last month.
They report that UK investors withdrew a net £3.02bn from equity funds during November, with North American and UK-focused equity funds hardest hit. That’s the second-worst month on record, only beaten by October, as investors fretted that the chancellor might make changes to pension lump sum withdrawals rules, or hike capital gains tax rates.
However, the arrival of the budget caused a sudden halt to outflows. Inflows resumed on Budget Day (Wednesday 26), Thursday 27th and Friday 28th. Every other day of November in the run up to Budget Day except one saw net selling.
This adds to the evidence that the flurry of pre-Budget leaks – now to be investigated – affected investors, as well as knocking business and consumer confidence.
Calastone’s latest Fund Flow Index for November also shows that UK investors have cut their holdings in equities by £10.39bn since the start of June, having sold down equities for a record six consecutive months.
Edward Glyn, head of global markets at Calastone, says investors have been unsettled by uncertainty over budget plans.
“The political narrative has played havoc with UK savers in recent months. Never have we seen such consistent or large-scale selling before. The sudden halt in equity-fund outflows that took place after the budget was delivered is clear evidence that many investors were selling their holdings as concerns rose at the possible curtailment of pension lump sum withdrawals, or of further capital gains tax hikes.
“The recent period of policy uncertainty has clearly unsettled investors and, in some cases, prompted reactive decisions they may later regret. Savers benefit most from clarity and consistency, so they can plan properly for long-term goals.”
Updated
Smaller business will see an increase in network charges under Ofgem’s plans.
The regulator says that by 2031, indicative network charge increases range from around £60 a year for a small holiday let or retail kiosk to £1,700 for small offices or hotels and £9,760 for a medium factory.
National Gas, who run Britain’s gas network, have crunched today’s pricing decision from Ofgem , and worked out they have been given a “baseline funding level” of £3.2bn.
That’s up from the draft determination of £2.46bn made in the summer.
National Gas chief executive, Jon Butterworth, said:
“This funding outcome confirms the critical role that the gas transmission system plays in Britain’s energy security now and for decades to come. For just 3p per day, less than 0.5% of the average consumer dual-fuel bill, Britain’s national gas transmission system continues to deliver excellent value for money for consumers – keeping our lights on, industries powered and homes warm.
“Over the past few months, our teams have worked extensively and constructively with Ofgem to provide additional evidence on the case for further investment in Britain’s national gas network to safeguard our country’s energy security and deliver benefits for consumers.
“In the coming weeks, we will undertake a more detailed review of Ofgem’s decision to ensure it enables us to deliver a safe, resilient network that secures Britain’s energy, maintains our industrial competitiveness and supports the country’s clean energy ambitions.”
Greenpeace is urging Ofgem to ensure energy customers are not hit with unnecessary bill increases.
Greenpeace UK’s senior climate advisor, Charlie Kronick, said:
“Britain’s energy grid is no longer fit for purpose. And without vital upgrades now our electricity system risks suffering a similar fate as our water network – much higher costs and underperformance further down the line.
“This money must be spent effectively, however, with robust safeguards and strong regulation to protect bill-payers, and ensure these upgrades deliver genuine value for money, offering fair but not excessive returns. We hope Ofgem have, and will continue to, strain every sinew in ensuring that new technologies of storage and flexible demand are adopted to minimise costly upgrades.
“Energy costs are a major pressure on households and businesses and, as we move to a cleaner energy system, prices must eventually come down. The government should be prepared to step in to ensure our energy system works for billpayers, not profits.”
DESNZ: essential to upgrade gas and electricity networks
The UK government has welcomed Ofgem’s decision to approve £28bn of new investment in the energy grid.
It says the spending is vital, after years of underinvestment in the energy system.
A Department for Energy Security and Net Zero spokesperson said:
“This government is taking action to bring down energy bills for families, with the Budget taking an average £150 of costs off bills in April, and expanding our £150 Warm Home Discount to over six million families.
“Upgrading our gas and electricity networks after years of underinvestment is essential to keep the lights on and ensure energy security for our country. Without these plans, which were first set out under the previous government, costs would spiral and our security would be compromised.
“The only way to bring down bills for good and get off the fossil fuel rollercoaster is with this government’s mission to deliver clean homegrown [energy] that we control.”
Introduction: £28bn energy upgrade gets green light
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Plans to spend £28bn to upgrade Great Britain’s electricity grid have been signed off, in a move that should improve the energy networks, speed the transition to new forms of energy…and increase household bills.
Energy regulator Ofgem has just announced that energy companies have been given approval to “strengthen the stability, security and resilience of our energy networks”. by upgrading the energy grid.
The majority of the spending – £17.8bn - announced today is to maintain Britain’s gas networks.
There’s also £10.3bn to improve the nation’s high-voltage electricity network – the biggest expansion of the grid since the 1960s.
In total, it’s around £4bn more than was provisionally signed off in the summer.
Ofgem says the investment is the most cost-effective way to harness clean power, support economic growth and protect the country from a repeat of the 2022 gas price shock.
Customers will see the impact on their bills, which will rise to cover the cost of the investment. The regulator says £108 will be added to bills per year by 2031; £48 for gas and £60 for electricity.
But it claims, the investing will actually save customers £80 each compared to a word where the grid is not expanded.
So overall, the net increase in bills to cover all costs by 2031 works out at £30.
Jonathan Brearley, Ofgem CEO, insists the regulator isn’t allowing “investment at any price”, adding:
Every pound must deliver value for consumers.
Ofgem will hold network companies accountable for delivering on time and on budget, and we make no apologies for the efficiency challenge we’re setting as the industry scales up investment.
We’ve built strong consumer protections into these contracts, meaning funds will only be released when needed and clawed back if not used. Households and businesses must get value for money, and we will ensure they do.”
The agenda
9am GMT: UK new car sales data for November
9.30am GMT: UK construction PMI report for November
10am GMT: Eurozone retail sales for October
12.30pm GMT: Challenger US job cuts report
1.30pm GMT: US weekly jobless claims
Updated
