The Chancellor has been warned her “jobs tax” will see over the coming months that one in four businesses are planning to make redundancies.
The Chartered Institute of Personnel and Development (CIPD) did a survey of 2,000 businesses and found that global uncertainties and soaring employment costs has seen office numbers plummet to a record low.
James Cockett, senior labour market economist at the CIPD, said: “From April, employers across the UK have begun to feel the full effect of increases to National Insurance Contributions and the National Living Wage outlined in last year’s budget.
“They’re also looking at the potential impact of the Employment Rights Bill on employment costs and plans, and this comes at a time of global uncertainty. Employer confidence is low, which is being reflected in their hiring plans.
“The Employment Rights Bill is landing in a fundamentally different landscape to the one expected when it formed part of the Labour manifesto in summer of last year.
“It was always going to be a huge change for employers but they’re operating in an even more complex world now. It’s vital the government works closely with employers to balance the very real risk of reductions in investment in people, training and technology with their desire to reduce poor employment practice.”
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Andrew Griffith MP, Shadow Secretary of State for Business and Trade warned, “Alongside making families £3,500 worse off, Labour’s Jobs Tax is crushing confidence, killing jobs, and pushing employers to the brink. Under Labour, the economy has flatlined and with businesses under mounting pressure, things can only get worse.
“This report only confirms what we hear daily from the shop floor to the boardroom: confidence has collapsed. Labour can’t understand why, because their cabinet has zero business experience.
“While businesses are wading through 300 pages of union-written legislation, facing higher National Insurance and mounting compliance costs, Labour still dares to claim they’re pro-growth. The truth is, they’re killing Britain’s businesses.”
A Treasury spokesman said, “In a period of global uncertainty this government is delivering stability for business.
“Trade deals with India and the US show the benefits of our cool-headed diplomacy.
“We have provided business rates relief, capped corporation tax, and are protecting the smallest businesses from the employer National Insurance increases.
“And we’ve now seen four interest rates cuts since July, making it cheaper for businesses to borrow.”
