Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

Hiring revival in doubt as employer confidence wanes over tax rises and workers’ rights bill

by May 29, 2025
May 29, 2025
Hiring revival in doubt as employer confidence wanes over tax rises and workers’ rights bill

Hopes for a sustained recovery in UK hiring “hang in the balance” as employer sentiment is hit by concerns over rising payroll taxes and incoming workers’ rights legislation, according to a new report by the Recruitment & Employment Confederation (REC).

In its latest survey released on Thursday, the REC found that while short and medium-term hiring intentions improved in the three months to April, broader economic confidence among employers deteriorated, raising questions over whether a long-anticipated labour market rebound will fully materialise.

The REC’s economic confidence index plunged by 12 points over the quarter to a net minus 35, signalling deepening concerns about Britain’s growth prospects. Meanwhile, the index measuring employer investment intentions also fell, by five points to minus 9.

Kate Shoesmith, deputy chief executive of the REC, said businesses were torn between cautious optimism and mounting risks: “Firms clearly see potential, but they also see risk. While improving hiring intentions suggest a jobs comeback this year, the extent of any bounce back depends on the economic and political headwinds on firms easing a fair bit.”

The hiring outlook improved despite April ushering in two major cost increases for employers. The main rate of national insurance contributions (NICs) rose from 13.8 per cent to 15 per cent, and the earnings threshold at which NICs are paid fell from £9,100 to £5,000. Combined, these changes represent a £25 billion increase in payroll taxes. The minimum wage also jumped by 6.7 per cent last month, adding further pressure, particularly on sectors like hospitality, care and retail which rely on lower-paid, part-time staff.

Although private sector surveys have indicated that employers may cut hiring to offset rising NICs, some economists have warned that such surveys may overstate the impact by focusing too heavily on sentiment rather than concrete hiring decisions. The NICs increase, they argue, is worth less than 1 per cent of GDP and may be absorbed by many businesses.

The mood in the business community has also been unsettled by the government’s Employment Rights Bill, which is making its way through the House of Lords. The legislation, described by ministers as a generational upgrade to employment law, aims to improve sick pay access, encourage trade union membership, and offer greater predictability over working hours.

While the Trades Union Congress has welcomed the bill as a long-overdue boost for workers, business lobby groups including the CBI have warned it could act as a brake on hiring by raising compliance costs and red tape for employers. These concerns have prompted calls for careful implementation.

“Getting the Employment Rights Bill right will help,” Shoesmith said. “Firms want reassurance that the application of the bill avoids tying businesses and workers up in greater costs and complexity.”

Despite the mixed signals, official data still shows that the labour market remains relatively resilient. The latest figures from the Office for National Statistics (ONS) show vacancies at 761,000 in the three months to April — well below the 1.3 million peak seen in mid-2022, but still high by historical standards. Unemployment stands at 4.5 per cent, though the reliability of ONS figures has been questioned due to falling survey response rates.

The REC report suggests the next few months will be pivotal. GDP grew by a stronger-than-expected 0.7 per cent in the first quarter, fuelling hopes of a broader recovery. But with employer confidence sliding and policy uncertainty mounting, the future of Britain’s jobs market may hinge as much on politics as economics.

As Shoesmith put it, “The bounce-back is possible, but far from guaranteed.”

Read more:
Hiring revival in doubt as employer confidence wanes over tax rises and workers’ rights bill

0
FacebookTwitterGoogle +Pinterest
previous post
Wealthier homeowners hit as banks raise mortgage rates amid inflation fears
next post
Ministers to gain power to mandate pension fund investment in UK assets

You may also like

Elon Musk’s government cuts could hand billions to...

February 17, 2025

How AI Content and YouTube Automation are slowly...

March 3, 2023

Octopus Energy to Invest $2 Billion in US...

June 19, 2024

Investors in tech start-ups do not trust female...

January 3, 2023

Farmers received less than 0.5% of post-Brexit money...

February 13, 2023

Richard Desmond drops part of his claim in...

July 30, 2025

UK slips behind France in race for renewable...

June 23, 2025

Oliva secures €5m to expand workplace mental health...

June 22, 2023

Business Settings that Need Rolling Shutters

May 15, 2025

British Factories Are Getting Smarter—But It’s Not Where...

July 26, 2025

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Mitchell Geisler on Listening, Leadership and Business Growth

      August 23, 2025
    • 10 key takeaways from DOJ’s release of Ghislaine Maxwell’s Epstein interviews

      August 23, 2025
    • Jackson’s scathing dissent levels partisan charge at colleagues after high-profile ruling

      August 23, 2025
    • Starmer accused of betraying farmers as British food pledge stalls

      August 22, 2025
    • Fed rate cut looms after Powell’s Jackson Hole speech

      August 22, 2025
    • Tariff “Inclusion” Process Comes with High Costs, Absurd Outcomes, and Extra Cronyism

      August 22, 2025

    Categories

    • Business (8,858)
    • Investing (2,235)
    • Politics (16,465)
    • Stocks (3,228)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved