UK beauty industry outpaces economy but exports and employment expected to decline
The British Beauty Council’s annual The Value of Beauty report has revealed that the personal care industry is growing significantly faster than the UK economy. The report, commissioned by Oxford Economics, shows that the UK’s beauty sector contributed £30.4 billion (US$38.91 billion) to GDP in 2024, an increase of 9% yearly (5% adjusting for inflation).
The recorded growth rate is four times faster than the overall UK economy’s 1.1%, compared to 5% for beauty. However, despite this GDP contribution, employment and export levels within the sector are predicted to decline in 2025.
According to data, the 2024 GDP increase was driven by a surge in consumer spending, which witnessed an 8% increase year on year and grew to £32.4 billion (US$44.03 billion) as a result.
Professional services contributed £10.1 billion (US$13.79 billion) to the total, up 15% yearly, while personal care goods accounted for £22.3 billion (US$30.33 billion), a 5% increase. Growth in 2024 remained strong despite inflation considerations, with +10% for services and +3% for goods.
Economic forecasting predicts the UK’s personal care industry will contribute a GDP of £31.5 billion (US$42.8 billion) in 2025, a 3% rise from 2024. A slowdown in household spending on personal care products and services underpins the conservative growth rate.
The beauty footprint
The UK’s beauty and personal care sector delivers more than consumerism, continuing to drive meaningful economic impact through stable job growth between 2019 and 2024.
According to Vasilis Douzenis, associate director of Oxford Economics’ Economic Impact department, the industry’s contribution to GDP and job creation rivals that of major creative and leisure sectors.
“The sector supports a growing share of the country’s GDP, jobs, and tax revenue.
Beauty now directly contributes a larger share of GDP than the sports, amusement, and recreation sector. It also employs more jobs than the publishing and broadcasting sector,” Douzenis says.
The Value of Beauty report reveals the impact of the UK beauty industry on the economy.In 2024, the beauty sector directly employed 496,000 workers (700,000 total job footprint), an 11% increase year over year. This figure is reportedly higher than the 2019 pre-pandemic peak of 478,000. However, the Value of Beauty report predicts that overall jobs will decline by 2% to 681,000 in 2025.
At the same time, the industry’s tax contributions for the year will rise from £8.6 billion (US$11.69 billion) to £9.4 billion (US$12.82 billion) following recent government policy measures, including the rise in minimum wage and national insurance contributions.
Brexit and trade decline
Alongside declining job opportunities within the beauty sector, the report claims the UK’s beauty exports will continue to fall. The EU exerts significant control over the UK — 47 % of non-beauty goods are exported from the UK to the EU single market, and 70% of beauty and personal care exports were to the continent.
“Beauty’s drop in exports, and top exporting locations, doesn’t come as a surprise given the repercussions of not only Brexit but also the fluctuation in trade red tape globally,” says Millie Kendall, CEO of the British Beauty Council.
“With 70% of beauty’s exports going to the EU, it is important that policy-makers mitigate trading challenges to the rest of the world to aid our global growth. That said, brands have a clear appetite to focus on their home market, building their reputation in the UK.”
Since the end of 2020, exports of personal care goods to the EU single market have fallen by 5.9% annually. For the rest of the world, they have declined by 4.4% annually.
Competitive beauty landscape
Against a broader economic slowdown for the UK, recent reports show that K-beauty exports continue to outperform as sustained global demand and influence grow.
The uplift is due to viral social media traction and consumer demand for solutions that key into major trends, such as K-beauty’s multifunctional products.
A surge in consumer spending drove the UK’s beauty industry’s GDP increase in 2024.
Last week, Personal Care Insights reported that South Korea became the second-largest global cosmetics exporter, surpassing the US and trailing behind France. According to the Korea International Trade Association, the country exported US$3.61 billion worth of beauty products from January to April, edging out the US with US$3.57 billion.
K-Beauty’s growing global demand has continued to reshape the competitive landscape and pose a significant challenge to established industry leaders. France still leads the sector with French cosmetic exports breaking a new record in 2024, reaching a value of €22.5 billion (US$26.5 billion).
Spate recently found that “Korean skin care” recorded a 119.8% surge in popularity as a search term.
Meanwhile, countries are rethinking global export strategies in a bid to strengthen their economies. Last month, Argentina announced they are removing export taxes on 4,411 goods, including cosmetics and personal care products, to expand international exports and trade.
