IWFM responds to the Spring Statement – 03/03/2026

News

IWFM’s Head of Policy and Insight, Andrew Gladstone-Heighton reacts to the Spring Statement, against the background of rapidly changing events in the Middle East. 

It was a mixed package of messages from the OBR in Tuesday’s Spring Statement. 

The volatility of markets and economies has been thrown into sharp focus by the geopolitical events across the Middle East over the last few days. 

With disruption to global trade flows, we are anticipating a spike in oil and energy prices that today’s forecast was not able to take into account. For the facilities management sector, where energy use, cost control and operational planning remain central concerns, this uncertainty will be particularly significant for organisations and for those managing estates. 

Context 

Headline indicators show that inflation fell in January and the UK recorded modest economic growth in the final quarter of 2025. At the same time, unemployment is rising, especially among younger people. 

Unemployment has increased across all age groups but has had a sharper impact on younger workers: 739,000 people aged 16 to 24 were unemployed, a rate of 16%. This is almost 100,000 higher than a year ago and the highest level for this age group since 2015. For a sector already managing an ageing workforce and continuing skills gaps across technical and managerial roles, this trend is concerning and may affect the longterm talent pipeline for FM. 

The OBR has also downgraded its economic growth forecast for this year to 1.1%. It had previously expected the economy to grow by 1.4% in 2026. 

However, forecasts for 2027 and 2028 have been revised upwards from 1.5% to 1.6%, while predicted growth for 2029 remains at 1.5%. 

Public sector net borrowing is projected to fall, but public expenditure is under pressure due to the likely future costs of welfare spending following the sharp rise in disability and healthrelated caseloads since the pandemic. This again raises questions for employers, including those in FM, about workforce availability, productivity and longterm planning. 

The impact of these forecasts on investment, service delivery and business confidence – set against the evolving conflict and its effect on supply chains, construction materials and energy costs – will become clearer over the coming weeks and months. For IWFM members, understanding these shifts will be essential to navigating budgets, contractual pressures and workforce needs in the year ahead. 

The Institute will be diving deeper into the FM market in our forthcoming Market Outlook report, which will explore business confidence and sentiment from the FM Sector.