The UK's 'zombie' companies are expected to collapse in 2026, leading to a surge in unemployment, according to a report. This economic phenomenon, where businesses struggle to adapt to rising costs, could mark a pivotal moment for the nation's job market. The Resolution Foundation predicts a 'turning point' in productivity growth, but warns of a potential unemployment spike as unproductive firms go bust. With interest rates and minimum wages rising, the foundation's CEO, Ruth Curtice, suggests a 'zombie apocalypse' is imminent, threatening job security. The current economic climate, marked by high unemployment and business uncertainty, is a result of tax increases and living wage hikes. Experts highlight the presence of 'zombie firms' as a hindrance to economic growth, while economists point to low interest rates post-2008 crisis as a contributing factor. The Bank of England's rate hikes have put pressure on businesses, and the British Chambers of Commerce reports a slump in business confidence. As the economy navigates this challenging period, the focus is on supporting living standards and ensuring a sustainable recovery.
