Job losses accelerate at fastest pace in four years, data shows
Share:
Redundancy rates have hit their highest levels in nearly four years in the wake of Chancellor Rachel Reeves' Autumn Budget, fresh data suggets. The closely watched S&P Global Flash Composite Purchasing Managers' Index shows companies have been slashing jobs this month at the fastest pace since the Covid-19 lockdowns in January 2021.
With the exception of the pandemic, UK employment decreased at the greatest rate since the 2008/09 global financial crisis. S&P Global blamed the decline on the 'gloomier outlook' following the tax hikes announced in the recent Budget and the 'broader direction of government policy' in the coming months.
Chancellor Rachel Reeves announced on 30 October that employers will pay a 15 per cent National Insurance rate on staff salaries above £5,000 from April instead of the current 13.8 per cent levy on wages exceeding £9,100. Concurrently, the National Living Wage will rise by 6.7 per cent to £12.21 per hour and the hourly minimum wage for 18 to 20-year-olds will jump by 16.3 per cent to £10.
Redundancies have hit their highest levels in nearly four years following the Budget. Chris Williamson, chief business economist at S&P Global Market Intelligence, said many companies are responding to these policies with a 'market pull-back' in hiring, especially within the leisure and financial services sectors.
S&P said service providers have endured a 'particularly steep' drop in recruitment, largely from not replacing people who had voluntarily quit. Other firms have either reduced working hours or embarked on longer-term plans to restructure their workforce.
