UK businesses are reducing their staff numbers more rapidly than at any time since the global financial crisis.
As per The Guardian, the reason behind this is the government’s budget, which includes raising taxes.
The most recent report from the purchasing managers’ index (PMI) survey shows that employment in December fell at the fastest rate since 2009, not including the period during the coronavirus pandemic.
Chris Williamson, the chief business economist at S&P Global Market Intelligence, which compiles the PMI survey, said in a statement, noting, “Economic growth momentum has been lost since the robust expansion seen earlier in the year, as businesses and households have responded negatively to the new Labour government’s downbeat rhetoric and policies.”
He added, “Firms are responding to the increase in national insurance contributions and new regulations around staffing with a marked pull-back in hiring.”
The clearer understanding of how Chancellor Rachel Reeves’ budget is influencing the economy will be revealed next year on March 26, when the independent Office for Budget Responsibility (OBR) releases its next forecast.
Andrew Griffith, the shadow business secretary, said the latest PMI data was “shocking.”
He added, “This follows Labour’s jobs tax as sure as night follows day. The chancellor must start listening to businesses, and not just her union paymasters, or working people will continue to be hammered.”
