Collapse of ‘zombie’ UK firms forecast to fuel unemployment in 2026

Businesses being hit by rising cost of interest rates, energy costs and wages, says Resolution Foundation

The UK is poised for a rise in unemployment in 2026 fuelled by the collapse of “zombie” companies that have struggled to adapt to a rise in business costs, according to a report.

At the start of what could be a pivotal year for the economy, the Resolution Foundation said businesses were grappling with a “triple whammy” of multiyear increases in interest rates, energy prices and the minimum wage that could “finish off” some underperforming companies.